Spanish olive oil production drops by half and price triples – 09/23/2023 – Market

Brígida Jiménez Herrera has a small 30-hectare plantation in Jaén, Andalusia. She produces olive oil, but hasn’t seen the color of the picual variety olives since the year before last. Due to lack of rain, Europe is facing the biggest olive oil crisis in the last decade.

Spain, which accounts for 45% of all the world’s olive oil, saw its production fall from 1.4 million metric tons (about 1.5 billion liters) in 2022 to less than half, 660 thousand (or 719 million liters), this year (the forecast is for a little more in recent months, according to data from the International Olive Council). “I hope it still rains so we can save something from this harvest”, says Herrera

“I didn’t harvest anything last year. Nor this year. So, the price of olive oil goes up,” she says. “The producers lose, who sell almost nothing, the distributors lose, who cannot increase enough to make a profit, and the consumers lose, who are already suffering general increases in food prices and also in olive oil.”

In fact, according to a survey by the Spanish Ministry of Agriculture, Fisheries and Food, the price at origin, the one that the producer receives when selling to distributors, for 100 kg of extra olive oil was €202 (R$1,058) in 2020 It increased by more than 50% in the following two years, to €331 in 2021 and to €335 (R$1,755) in 2022.

No one, however, was prepared for this year’s increase, which more than tripled prices compared to 2020. Today, 100 kg sold by producers costs €615 (R$3,222). “But no one is getting rich here. On the contrary,” he says.

It turns out that, in addition to being a small producer, Brígida Jiménez Herrera is also the director of the Córdoba region of the government body Ifapa (Andalusian Institute of Agricultural, Fishery, Food and Ecological Production Research and Training), which takes care of olive groves in Andalusia, the autonomous community that accounts for the majority of Spanish olive oil and brings together 180,000 olive farmers.

Therefore, she also has a vision of what the country is doing to try to mitigate this crisis. “The limiting factor is the weather,” she says. “Pluviometry that used to be 700 mm or even 1,000 mm, in mountainous regions, has dropped in the last year to between 300 mm and 450 mm.”

Herrera cannot say whether climate change on the planet is responsible for the current situation. “I’m not an expert on this subject, but it’s clear that when temperatures rise, there are changes in harvests. The fact is that these crises happen sometimes. We had another one like this in 2012 and 2013,” she recalls.

The cost of growing olives in Spain is around €1,000 (R$5,238) per hectare per year. In her case, which has 30 hectares, the cost was €30,000 (R$157,000) last year and another €30,000 now, with the money input being zero.

Asked about a possible domino bankruptcy of producers in the region, she says it hasn’t happened yet. “First of all, the farmer has an extremely conservative profile. He never spends everything he earned in the previous harvest on the next harvest. He saves money for situations like this, which can always happen”, responds Herrera.

And there is also help from the European Union, which has an aid program for farmers in difficulty. “The EU helps with €300, up to €400 per hectare, to preserve the production chain — all the people who depend on the harvest, from employees to farmers and their families”, he says.