Olive oil prices are on track to halve, says world’s biggest producer

The world’s largest olive oil producer is predicting cooling prices after the industry saw record prices at the start of the year due to the mixed impact of climate change-related drought on the harvest and high interest rates and inflation in the value chain.

In the EU, olive oil prices were up by 50% year-on-year in January and in the UK they jumped by 150% compared with the end of 2021.

In Spain, home to almost half of the world’s olive oil production, two consecutive years of drought limited olive harvests, causing a hike in prices worldwide.

Deoleo, the maker of household olive oil brands such as Bertolli and Carbonell, expects a much better harvest in the 2024-2025 season.

“The outlook is positive for the coming months, as the market is expected to begin to stabilize and normality is expected to be gradually restored as the new harvest progresses and supply increases,” said Miguel Ángel Guzmán, chief sales officer at Deoleo, to CNBC, adding that the crisis is not entirely over as there is still tension in certain high-quality olive oil prices, such as Extra Virgin.

The company expects prices to fall to half the record levels seen at the start of the year.

“The relaxation of prices at origin is expected to begin between November, December and January, provided that weather and harvest conditions remain stable in the coming weeks,” according to Guzmán, cited by CNBC.

Meanwhile, other Mediterranean countries are facing mixed outlooks. Greece is battling a prolonged drought, dashing hopes for a robust harvest. Turkey, which became the world’s second-biggest olive oil producer last year, is estimating a record-breaking harvest yielding 475,000 tonnes of olive oil.