In W31 in the olive and olive oil landscape, global olive oil production, notably in Spain and Italy, decreased by 20% in the 2022/2023 season, driven by drought in Europe. In contrast, Turkey experienced a significant rise of 62% in production. In the first six months of 2023, Turkey's olive and olive oil exports have already surpassed the previous year's total. According to Turkish Exporters Assembly (TIM) data, exports grew by 190% from Jan-23 to Jun-23 compared to the same period last year, reaching USD 559.8 million. Notably, Turkey's olive and olive oil exports to Spain increased from USD 7.6 million in the first half of 2022 to USD 203.9 million during the same period in 2023. Additionally, Turkish olive oil exports from Nov-22 to Jul-23 in the 2022/2023 season reached 136.5 thousand metric tons (mt), a substantial 240% increase in quantity compared to the previous season.
While packaged olive oil exports in Turkey rose by 3% in volume, bulk olive oil exports surged by 5.5 times, and barrel exports increased by four times. This substantial increase in bulk and barrel olive oil exports led to higher domestic prices. In particular, Italy and Spain processed and resold the bulk and barrel olive oil imported from Turkey to third countries. Olive oil prices have more than doubled since Jan-23, reaching USD 6.29 or even USD 6.66 from the previous year's range of USD 2.59 to USD 2.96/liter, with the possibility of further increases due to factors like the ongoing drought. As a result, the Turkish authorities decided to suspend the export of olive oil until November 1 due to global price increases.
Olive oil production in Southern Europe is set to decrease by over 1 million metric tons (mmt) in 2023, reaching 1.39 mmt, due to the impacts of climate change. The significant reduction is mainly attributed to Spain, where olive oil production more than halved in the 2022/23 season. This production decline has driven a 40% increase in the cost of olive oil during the 2022/23 season. In W31, Spanish olive oil prices reached an all-time high of USD 8.79/kg EXW, fueled by a shortage caused by adverse weather conditions, including heat waves and insufficient rainfall in recent months. Without the aid of autumn rains to counteract the effects of extreme heat, the upcoming crop is anticipated to have similar scarcity characteristics as the previous season.
Meanwhile, Greece's olive oil production in 2023 will decrease by a third, to 200 thousand mt, due to heat, drought, pests, and forest fires. Consequently, olive oil prices in Greece have been consistently rising. Cooperatives in the Laconia region of Greece are currently selling wholesale olive oil shipments at USD 9.15/liter, significantly higher than the USD 3.19/liter in 2021. It's projected that the price of a liter of olive oil in local supermarkets could soon surpass USD 10.99.
