1. Weekly News

Argentina

Enhancing Olive Oil Productivity in Catamarca, Argentina

A team of specialists from the National Institute of Agricultural Technology (INTA) in Catamarca, Argentina, has proposed various practices to boost productivity in the olive oil sector. Drawing on 30 years of research, they emphasize developing local varieties, improving irrigation technology, and modernizing cultivation methods. Researchers highlighted the importance of selecting olive plants that adapt well to the region's arid and semi-arid climates, focusing on high production and superior oil quality. Catamarca has about 12 thousand hectares (ha) of productive olive groves, with the 2023 harvest yielding 72 thousand tons of olives. INTA's initiatives include promoting intensive planting systems, mechanizing labor-intensive tasks, and evaluating plant behavior under local agro-climatic conditions to refine irrigation strategies.

Chile

Chile's Olive Oil Industry Strengthens Commitment to Sustainability with Third Clean Production Agreement

The Chilean Agency for Sustainability and Climate Change (ASCC) and the ChileOliva Association signed their third Clean Production Agreement (APL) for the olive oil industry. This initiative focuses on regenerative agriculture, resource efficiency, and circular waste management to address water scarcity and climate risks. The agreement aligns with Chile's 2020 to 2030 Agro-Food Sustainability Strategy and aims to enhance biodiversity, carbon neutrality, and market competitiveness. Public-private collaboration continues to drive sustainability, with training and innovations supporting the industry's adaptation to climate change.

Egypt

Agricultural Committee Discusses Expansion Strategies in Egyptian Olive Oil Production

The Egyptian Senate's Agriculture and Irrigation Committee reviewed a study on the importance of olive oil production for boosting Egypt's agricultural sector. Despite planting 268 thousand acres of olive trees and producing 1.8 million tons annually, the study highlighted the need for a clear strategy for olive oil production. Experts suggested that expanding the cultivation of oil-producing olive varieties and proposed creating a National Olive Council. Egypt currently exports 90 thousand tons of olives, and Spain is its largest olive oil importer. The committee recommended further research and strategic plans for industry growth.

Europe

EU Expects Increased Olive Oil Production and Exports in 2024/25

The European Union (EU) anticipates a significant recovery in olive oil production for the 2024/25 campaign, with a projected 31% increase in volume, reaching 2 million tons, primarily driven by a 50% increase in Spanish production, reaching 1.3 million tons. This growth will lead to lower prices and a 7% rise in consumption. Additionally, exports are expected to grow by 10%, while imports may decrease by 7%, depending on competition from countries like Tunisia and Turkey. Projections for final EU stocks could reach 601 thousand tons.

Greece

Olive Oil Prices in Greece Expected to Drop in 2024 Due to Improved Harvest

Olive oil prices in Greece are predicted to fall by up to 50% in 2024, following better harvest conditions than in 2023. The Association of Greek Olive Oil Standardization Industries (SEVITEL) expects a production increase of 220 to 230 thousand tons, leading to price stabilization. Drought and rising production costs in 2023, partly driven by the war in Ukraine, caused olive oil prices to reach record highs. With this year's better yield, extra virgin olive oil prices are expected to settle between USD 4.33 to 5.41 thousand per ton (EUR 4 to 5 thousand/ton), with market effects visible by early 2025.

Italy

Italy Faces a Challenging Olive Oil Production Outlook for 2024/25

Italy's olive oil production for the 2024/25 campaign is projected to be from 215 to 235 thousand tons, placing the country fifth in global output. Despite a 75% recovery in northern regions and a 70% increase in central areas, southern Italy, especially Apulia, is set to see a 41% drop due to drought and poor flowering, reducing volumes by half. Italian exports from Jan-24 to Sep-24 increased by 7% in volume and 63% in value, driven by high demand from the United States (US).

Apulia's Olive Oil Sector Strengthens Ethical Pact for 2024/25

The olive oil sector in Apulia, Italy, is renewing its commitment to protect the supply chain by reinforcing the "Ethical Pact" among farmers, mills, and packers. Initially introduced in the 2023/24 season, the pact aims to address rising costs and combat the effects of Xylella disease. By fostering collaboration, the industry seeks to maintain stable prices and protect the quality of extra virgin olive oil, ensuring transparency and consumer protection for the 2024/25 season.

Morocco

Olive Oil Prices Surge in Morocco Due to Production Challenges

As the olive harvest peaks in Oct-24, olive prices have reached USD 2.03 per kilogram (kg) (MAD 20/kg), signaling a potential surge in olive oil prices to USD 15.21 per liter (MAD 150/L). The industry is facing ongoing challenges, including droughts and lower yields. While the area planted with olive trees expanded by 61% between 2007 and 2022 and average yields increased by 209% from 2003 to 2022, Moroccan olive oil production has nearly halved. Olives now account for 65% of Morocco's fruit tree plantations, covering 1.2 million hectares (ha). Experts believe that imports may be necessary to address supply shortages and manage rising prices.

Spain

Concerns Rise Over Olive Oil Supply Amid Low Stocks and Harvest Delays in Spain

Contrary to predictions of a significant drop in olive oil sales in Spain for Sep-24, recent Ministry of Agriculture data has revealed unexpected results. Sales reached over 86,840 tons, leaving production stocks at just 77,489 tons, while industrial packers hold a mere 107,841 tons, the lowest figures seen in recent years. This situation raises concerns about the ability to meet the domestic and international demand in the coming months, especially considering that sales in Oct-22 totaled 129,830 tons. Furthermore, anticipated rainfall in the third week of October could impede olive harvesting and new production.

2. Weekly Pricing

Weekly Olive Oil Pricing Important Exporters (USD/kg)

Yearly Change in Olive Oil Pricing Important Exporters (W41 2023 to W41 2024)

Spain

In W41, olive oil prices in Spain slightly dropped to USD 8.11/kg, reflecting a week-on-week (WoW) decrease of 0.73%. This slight reduction is attributed to the devaluation of the US dollar (USD) against the euro (EUR), which similarly affected the month-on-month (MoM) price change of a 1.93% drop, as the USD was stronger in W38. Year-on-year (YoY) prices are down by 5.59% due to improved, though still challenging, harvest conditions compared to last year's severe supply constraints. Despite the lower prices, sales of Spanish olive oil have remained high, leading to reduced stock levels. With these low stocks, Spanish olive oil prices might increase in the upcoming weeks.

Italy

In W41, olive oil prices in Italy decreased to USD 10.12/kg, marking a WoW decline of 0.88% and a MoM drop of 2.13%. These drops are due to the devaluation of the USD against the EUR, as EUR pricing has remained stable over the past weeks. Prices are up 7.43% YoY, driven by lower supply this season due to unfavorable weather conditions. The 2024/25 olive oil harvest in Italy is expected to encounter further challenges, with projections indicating a 32% decrease in production due to drought and extreme heat impacting key regions. This anticipated supply drop will likely lead to higher price increases in the coming weeks.

Tunisia

Olive oil prices in Tunisia fell to USD 8.24/kg in W41, reflecting a WoW decrease of 0.84% and a MoM decline of 2.14%. This reduction is attributed to the USD's devaluation against the EUR, as prices have remained stable in EUR since W35. Despite this stability in EUR pricing, the currency shift has impacted the international pricing of Tunisian olive oil. Although prices have softened slightly, they may recover in the coming weeks due to the high global demand for olive oil.

3. Actionable Recommendations

Enhance Agricultural Practices

Producers in Argentina should adopt practices INTA suggested, such as developing local olive varieties suited for arid climates and modernizing irrigation techniques. Implementing intensive planting systems and mechanization will improve productivity and reduce labor costs. Similarly, producers in Greece and Italy can benefit from such practices to mitigate the impact of droughts and extreme weather events, particularly as Italy faces projected declines in production due to challenging climatic conditions. Establishing resilient agricultural practices, including drought-resistant varieties and efficient water management systems, can significantly enhance yields across these regions.

Promote Sustainable Production

Producers should adopt regenerative agricultural practices such as cover cropping and organic fertilization to promote sustainability in olive oil production and enhance soil health and biodiversity. Investing in efficient water management systems, like drip irrigation, will optimize water usage, especially in drought-prone areas. Additionally, utilizing integrated pest management to reduce chemical inputs, engaging in circular economy practices by recycling waste products, and pursuing sustainable certifications can significantly improve environmental impact. Promoting sustainable olive oil production is essential as demand for sustainable olive oil is rising as consumers prioritize eco-friendly and ethically produced products. This trend stems from increased awareness of climate change and the desire for transparency in sourcing. Producers using sustainable practices can differentiate their offerings, enhance brand loyalty, and attract consumers willing to pay a premium for quality and sustainability.

Stock Management in Spain

Producers should prioritize strategic stock management with low olive oil stocks in Spain to address supply challenges. This includes enhancing production techniques to manage weather-related challenges, such as implementing advanced irrigation systems and adopting climate-resilient olive varieties. Additionally, producers should prepare for potential increases in imports to supplement domestic supplies, ensuring that demand is adequately met. By enhancing production techniques and planning for higher imports, Spanish producers can bolster their market position and effectively respond to fluctuations in demand and supply.

Sources: Tridge, Agro Portal, Alakhbar, Almal News, East Fruit, Ekonomi, Elaias Karpos, Dnes, Oleo, Oli Merca, Portal del Campo, Son Dakika