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Olive oil production in Spain in the current crop year is expected to drop as the country is hit by drought while growers in Jaén province face losses of US$1bn (€1bn), according to an Olive Oil Times report.

Initial estimates by the Association of Young Farmers and Ranchers (Asaja) in Andalusia had forecast that Spain would produce 1M tonnes of olive oil in the current crop year, the 26 August report said.

Last year, International Olive Council data showed that the country produced 1.3M tonnes of olive oil – slightly below the five-year rolling average of 1.37M tonnes – Olive Oil Times wrote.

Some industry experts believed that olive yields would also drop significantly, the report said, as the country – the world’s largest olive oil-producing nation – faced a prolonged and severe drought and a series of heatwaves.

The Minister of Agriculture Luis Planas had publicly warned that olive production would slow down, Olive Oil Times wrote, while research group Mintec had predicted a 25%-30% yield reduction.

However, Primitivo Fernández, director of the National Association of Industrial Packers and Refiners of Edible Oils, was quoted as saying that the country had stocks of more than 500,000 tonnes, which would meet national and international market demand.

The drought had reduced the resilience of non-irrigated groves to the effects of heatwaves, Asaja was quoted as saying, while a reduction in water available for irrigation would not meet the demands of irrigated olive groves.

As almost 30% of the country’s olive groves were irrigated, decreased water availability would influence the final production figures, according to estimates by Juan Vilar Strategic Consultants reported by Olive Oil Times.

In a separate report on 26 August, Olive Oil Times reported that the Jaén section of Spain’s leading agricultural cooperative Cooperativas Agro-alimentarias had estimated that the province could lose up to US$1bn (€1bn) in the coming olive harvest if current conditions continued.

The organisation said that the province would produce 230,000 tonnes of olive oil in the coming crop year, a significant drop compared to the 2021/22 total of 499,796 tonnes.

Higinio Castellano, president of the association’s Jaén section, was quoted as saying that the poor harvest expectations were due to the extreme drought affecting the region.

The situation could worsen if no rain fell between the time of the report and the start of the harvest, he added.

Although Jaén had experienced a similar harvest in the 2014/15 crop year – the worst year for producers in the past decade – Castellano warned that this year’s drop in production would have a deeper economic impact.