High olive oil prices could be affecting overall demand in Europe, Olive Oil Times reported trade associations representing producers as saying.

Current olive oil price dynamics would affect local and international demand, according to the Spanish Association of Olive Oil Exporters, Industry and Commerce (Asoliva) and the National Association of Industrial Packers and Refiners of Edible Oils (Anierac).

The price at origin in Spain had risen 60% in the last year, while retail prices had risen by 35%, the associations noted.

Against this backdrop, Spain’s Ministry of Agriculture, Fisheries and Food said olive oil sales in the country in January totalled 89,000 tonnes, 37,000 tonnes of which were sold domestically.

According to the Agropopular news website, those volumes were well below the 100,000 tonnes usually sold monthly.

In addition, Spanish exporters said shipments in December had already dropped by 30% compared to the same period the previous year, Olive Oil Times wrote.

Poolred, an olive oil price database run by the Andalusian government, showed that all grades of olive oil had progressively increased their price at origin, reaching their peaks around mid-January.

A percentage of the increases had been due to reduced olive oil yields across the western Mediterranean, related uncertainties and rising costs for producers, the 9 February report said.

Since mid-January, price dynamics had begun to change, with extra virgin olive oil prices dropping from €5.46/litre (US$5.78/litre) in mid-January to €5.20/litre (US$5.51/litre) at the time of the report. Prices for virgin olive oils and lampante had also fallen.

However, some industry observers noted that the slight price drop would not immediately affect demand, which was expected to remain low as consumers struggled with challenging circumstances, the report said.

According to the European Commission’s market observatory, the price at origin had increased slightly less in Italy (51%) and in Greece (42%), the report said.

In Italy, Europe’s second-largest market in terms of volumes, olive oil prices remained stable, with extra virgin olive oil prices not showing any signs of falling.

According to latest estimates by the International Olive Council (IOC), olive oil consumption in the European Union for the 2022/23 crop year would drop to 1.4M tonnes from 1.55M tonnes the previous year.

Global consumption was also expected to slow from 3.239M tonnes to 3.055M tonnes.