Olive oil production in the European Union (EU) for the 2020/21 crop year is expected to reach a five-year high of 2.3M tonnes, Olive Oil Times reported from a short-term EU agri-food outlook report on 9 July.
Spring rainfall in Spain had led to excellent flowering and assuming conditions remained amenable for drupe development, the European Commission (EC) predicted another high yield.
As the world’s largest olive oil producing nation, Spain had produced 1.12M tonnes of olive oil in 2019/20.
In contrast, a dry spring in some of Italy’s major producing regions and a heatwave in Greece were likely to lead to smaller harvests. In the last crop year, the two countries had harvested 365,000 tonnes and 275,000 tonnes respectively.
Portugal was also anticipating a slightly smaller harvest in 2020 than it had in 2019, when the country produced a record 140,500 tonnes. However, the commission expected the country’s production would continue to increase.
The commission also estimated that total EU olive oil consumption would increase by 6% in 2020/21.
“An increase in home cooking due to COVID-19 measures led to a rise in retail sales of olive oil, in particular in the main EU producing countries and in the use of olive oil in the food industry,” the EU report said. “In non-producing EU countries, sales could likely decrease as a result of lower purchasing power.”
A 10% growth in the volume of exports was also expected while the failure of olive oil prices to recover throughout the EU meant that the value of exports would be 24% lower than the current crop year.
“There were positive signals pointing towards a price stabilisation early this year following the activation of private storage aid," the report said. “However, Jaén prices of virgin and extra virgin olive oil started to decline again at the beginning of the COVID-19 crisis in March.”
On a more positive note, the EC estimated that olive oil stocks in the trading bloc would fall to 609,000 tonnes by October, which would help stabilise the current supply with demand.