Olive oil prices have soared to unprecedented levels as severe droughts in producing countries have dwindled stocks. According to a recent report from the US Department of Agriculture, global olive oil prices surged to $8,900 per tonne in September, fuelled by extremely dry conditions in the Mediterranean region.
Spain, the world’s leading producer and exporter of olive oil, has been grappling with intense drought for months. The nation has also experienced its third consecutive hottest summer, with average temperatures being 1.3°C above normal, as per the national weather agency AEMET.
Data from commodities market company Mintec revealed that due to these circumstances, Spain’s olive oil output in the past season plummeted to roughly 610,000 tonnes. This signifies a decline of over 50% compared to the typical 1.3 to 1.5 million tonnes.
“The situation is further complicated by concerns over reduced production in other major European olive oil producing nations, including Italy and Greece, where drought conditions are predominant,” Mintec analyst Kyle Holland told CNBC.
Prices of olive oil in Spain’s Andalusia region leapt to €8.45 per kilogram in September. This represents the highest ever recorded price for Spanish olive oil, marking a 111% increase from the previous year.
This spike has led to an alarming rise in theft.
Approximately 50,000 litres of extra virgin olive oil, valued at over €420,000 on the market, was stolen from the Spanish oil mill Marin Serano El Lagar. This incident was preceded by thieves making away with 6,000 litres of extra virgin olive oil, worth €50,000, from the Teraverne oil mill.
Further complicating the market situation is Turkey’s decision to suspend bulk olive oil exports.