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According to the prediction of Filippo Berio, who exports olive oil products produced in Italy, Greece, Spain and Tunisia from Italy to other countries, olive oil prices will fall within 3 months. Of course, the reflection of this decline on all countries may not be so direct.
In Spain, which accounts for 50 percent of global olive oil production, scorching temperatures and drought led to a difficult two-year period for olive producers and brands.
Last spring, however, temperatures returned to normal and Spain’s olive groves produced healthy blossoms. Moderate winter rains followed, leading to an olive harvest of 1.4 million tonnes. This amount is on the upper side of normal for the country’s industry. Walter Zanre, Managing Director of Filippo Berio UK, said the harvest in 2022/2023 is almost half that.
“We sell 60 million litres of olive oil a year. At the end of last year we were really struggling to source, we had made preparations but there was no product around of the quality we needed. But as the new season oils came on the market, prices dropped. In reality, it takes about 3 months for these falling prices to reach the supermarket shelves. There were some discounts in November, but many retailers were reluctant to pass them on to consumers,” Zanre said.
Olive oil consumption back to 2004…
Pointing out that production has soared and prices are on a downward trend, but olive oil consumption has seen a significant decrease, Zanre explained, “Consumption is down 20 percent due to high prices over the last two years. People have also abandoned the category and it has fallen to the lowest levels in 2004. The shortage has cancelled out all the good work that was done to create this category.”
Zanre and the industry are not confident that consumers will return to the product simply because prices have fallen. This is made more difficult by the relatively low average purchase frequency of twice a year in markets such as the UK.
Highlighting that consumers have adopted new habits and bought other oils, Zanre added, “We are formulating a strong marketing campaign to bring people back to the category. The big marketing campaign has not yet begun, but our team are currently focusing on associating olive oil with health, especially heart health.”
