Olive oil production in the European Union (EU) is set to increase by a third in 2024/25 after two challenging years, according to latest projections by the European Commission (EC) reported by Olive Oil Times.
According to the EC’s latest agricultural short-term outlook, olive oil production in the EU is expected to increase by 32% compared to last season.
The increase would bring the estimated total yield for the upcoming season to 2M tonnes, Olive Oil Times wrote on 18 October.
In 2023/24, production dropped to 1.53M tonnes, with 1.39M tonnes recorded in 2022/23.
Spain was set to be the leading producer, with a forecasted yield of 1.3M tonnes, although sources in the country said production could reach up to 1.45M tonnes.
Olive oil production in Portugal and Greece was also expected to increase while Italy was expected to face a significant downturn, with production forecast to drop by a third.
Starting stock levels for 2023/24 fell to 410,000 tonnes, down from 671,000 tonnes the previous year. At the start of the new season, stock levels had dropped to 350,000 tonnes.
However, the EU expected stockpiles to recover to more than 600,000 tonnes by the end of the season, in line with average historical levels.
The expected surge in olive oil availability was likely to influence prices, Olive Oil Times wrote.
Olive oil prices had only slightly decreased since their peak in January 2024, reflecting expectations of a bumper harvest, the report said.
For example, according to the EU’s Agriculture and Rural Development Department, extra virgin olive oil prices in Spain fell from €9.03 (US$9.77)/kg to €7.43 (US$8.04)/kg although this remains significantly higher than the five-year average of €5.05 (US$5.47)/kg.
High prices had also impacted exports, with EU olive oil exports starting to decline during 2022/23, showing only slight signs of recovery by the end of 2023.
Between October 2023 and July 2024, exports were down 1.3% compared to the previous season and 26% lower than in 2021/22. However, a 10% rise in exports was expected for the new season.
Meanwhile, imports were expected to drop by 7%.
Despite this, solid yields and competitive prices in Tunisia and Turkey could shift the outlook as the season progresses, according to the report.
In the last season, EU olive oil imports rose by 30%, with 62% from Tunisia and 14% from Turkey.
Published on 8 October, the short-term outlook report also highlighted considerable uncertainty in the market, particularly regarding the slow decline in prices and its effect on consumers.
Some consumers had either reduced their use of olive oil or stopped purchasing it due to high prices, the report said.
According to the EU, with prices still elevated, olive oil consumption is expected to drop further by 1%, leaving it 23% lower than in 2021/22.
However, if prices at origin continued to decrease and those reductions were passed on to consumers, overall consumption in the EU could rebound by as much as 7%, Olive Oil Times wrote.
EU data showed that consumption in Spain, Italy, Portugal and Greece could reach almost 987,000 tonnes in 2024/25, up from 923,000 tonnes the previous season.
