+45% in one year, why the price of olive oil is increasing enormously

We see in our “RTL basket” that sunflower oil is at its lowest level since the war in Ukraine, still -7% over a month. But its cousin, olive oil, is on fire: An increase of 45% in one year. The first explanation is that it is too hot and too dry in the main producing countries. Spain is number 1 and supplies half of everything consumed in the world. Italy produces 15%, and you have another 15% divided between Greece, Portugal, Tunisia, Turkey and Morocco.

Spain is catching a cold and the whole world is getting sick, Olivier Nasles, president of the AOP Olive Oil of Provence, lets us understand. Production plummets due to drought: instead of producing 1.6 million tons of oil as usual, Spanish orchards produce were only able to supply 950,000 tons last year and the year before even less: 750,000 tons. Global supply is shrinking and prices are rising. Scholarship, the liter of olive oil went from 2.80 euros in 2021 to 9 euros today. The major manufacturers passed on the prices at the last negotiations in January. There is always a little delay afterwards, which is why the labels are currently lit.

French production is not affected by this production decline, the harvest was actually quite good last year. This means that you buy Spanish oil in the supermarket. In France we produce 5,000 tons of olive oil per year but we consume 120,000 tons of it96% of what we buy comes from abroad, almost always from Spain. There is no inflation on French oil, but our oils are much more expensive. It rarely starts below 26 euros per liter, so double the Spanish supermarket oil, because our types of olive trees are less productive, we do not load them with chemicals and the harvests are done by hand.

But coming back to the price, two years ago: we were 3 times more expensive. This means that our AOP oil from Provence, Nyons and Nîmes has gained competitiveness thanks to the inflation of Spanish production.

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