The oil industry and the Ministry of Agriculture were trying to reassure consumers this September by stating that the price of olive oil had probably peaked after reaching all-time highs in the summer. But these forecasts, at least for now, have not been fulfilled. The rise in oil prices continues unstoppable for now and the price at origin has once again broken records in December, with a price never seen before: 8.4 euros per kilo of extra virgin last Friday, Infaoliva data indicate.
The security seals that some bottles have in supermarkets and the increase in olive thefts in the countryside are proof that the price spiral continues to revolutionize. This week's INE data for November confirms this. Not only is olive oil more expensive than a year before (66.7%), something to be expected because the increase in prices began at the beginning of 2023, but every month the bottle of oil costs a little more in the supermarket. And although inflation in consumer prices has relaxed somewhat in October and November –see graph–, the latest strong rise in the price at source makes it difficult to think of a reduction in price.
Behind this new boost in prices at origin is a harvest that is not giving the expected results in some key areas for oil production. Juan Luis Ávila, responsible for the olive grove in the agricultural organization COAG, explains that the oil obtained from the olives – the yield – is lower than expected in part of the farms in Jaén, the first producing area in Spain followed by Córdoba. “Performance is being abnormally low, around 20% lower; "The drought has us on the ropes," he says on the phone in the middle of a plot of land with 400 olive trees near the capital of Jaén. In the background you can hear the machines that collect the olives. If in a normal campaign your trees should produce around 20,000 kilos of olives, this year they will provide around a thousand kilos and with an oil yield that is also lower than usual. “And they are irrigated; but here we have also had restrictions because there is not enough water for everything; From a right to 1,500 cubic meters I have gone to 400 cubic meters, and this is only enough to maintain the tree, not for good production,” he summarizes.
This situation is causing some farmers to stop olive harvesting because the little oil obtained is not enough to cover costs. They also observe this problem in Catalonia. “The yield of the olives has to be at least 10% for picking the olives to pay off,” emphasizes Jordi Pascual, coordinator of the oil sector at Unió de Pagesos and owner of a farm in the Penedès area. “This year we have lost 80% of production,” he laments. Catalonia is the autonomous community where oil production has fallen the most, with a decrease of 20% compared to the last campaign and 60% compared to the average of the last five years. The lack of product is causing thefts to multiply in Catalonia as well, says Pascual.
While prices do not decrease, olive oil consumption in Spain continues to decline. Consumers adapt by buying less, 18.3% between November 2022 and October 2023 compared to the same period of the previous year, while spending grew 26.2%, according to the latest data from the consulting firm Circana. The oil is thus approaching the category of luxury food.
