The oil industry and the Ministry of Agriculture tried to reassure consumers in September that the price of olive oil had probably hit a ceiling after hitting record highs in the summer. But these forecasts, at least for the moment, have not been fulfilled. The price of oil continues unstoppable for now and the price at origin has broken records again in December, with an unprecedented quote: 8.4 euros per kilo of extra virgin on Friday, according to Infaoliva data.
The security seals that take some bottles to supermarkets and the increase in thefts of olives in the countryside are the sign that the price spiral continues to be revolutionized. This week's INE data for November confirm this. Olive oil is not only more expensive than a year before (by 66.7%), which is to be expected because the increase in prices started at the beginning of this year, but every month the bottle of oil costs a little more at the supermarket. And although consumer price inflation eased a bit in October and November – see the graph – the latest sharp rise in the price at origin makes it difficult to think of a reduction.
Behind this new impetus for prices at the origin is a harvest that is not giving the expected results in some key areas for oil production. Juan Luis Ávila, responsible for olive groves in the agricultural organization COAG, explains that the oil obtained from olives - the yield - is lower than expected in some of the farms in Jaén, the first producing area of Spain followed by Córdoba. "The performance is being abnormally low, around 20% lower; the drought has us against the ropes", he comments on the phone in the middle of a plot with 400 olive trees near the city of Jaén. In the background you can hear the machines that collect the olives. If in a normal campaign their trees should give around 20,000 kilos of olives, this year they will bring around a thousand kilos and with an oil yield also below usual. "And that they are for irrigation, but we have also had restrictions here, because there is not enough water for everything; from a right to 1,500 cubic meters I have gone to 400 cubic meters, and with that we only have to maintain the tree, not for a good production", he summarizes.
This situation is causing some farmers to stop picking olives because the little oil obtained is not enough to cover costs. This problem is also observed in Catalonia. "The yield of the olive must be at least 10% so that harvesting the olives is profitable", emphasizes Jordi Pascual, coordinator of the oil sector at Unió de Pagesos and owner of a farm in the Penedès area. "This year we lost 80% of production", he regrets. Catalonia is the autonomous community where oil production has fallen the most, with a drop of 20% compared to 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, Pascual assures.
The prices are not reduced and the consumption of olive oil in Spain continues to fall. Consumers are adapting by buying less, 18.3% between November 2022 and October 2023 compared to the same period last year, while spending increased 26.2%, according to the latest data from the consultancy Circana. The oil thus approaches the category of luxury food.
