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Olive oil production in the European Union (EU) has reached 1.87 million tons from Sep-24 to Jan-25 in the 2024/25 campaign, with Spain leading at 1.23 million tons, followed by Portugal (195,000 tons), Italy (241,839 tons), and Greece (184,500 tons). The European Commission (EC) forecasts total EU production to rise to 2.08 million tons this season, up from 1.53 million tons in 2023/24. Spain is expected to see a 61.5% surge to 1.38 million tons, while Greece is projected to reach 250 thousand tons (up 42.8%), and Portugal is expected to produce 195 thousand tons (up 21.1%). However, Italy’s production is projected to decline by 25.8%. With EU olive oil consumption forecasted at 1.24 million tons and final stocks reaching 363 thousand tons, supply across the region is expected to remain stable.
Iraq's olive oil production reached a record high in 2025, marking a significant milestone for the country's agricultural industry. The Ministry of Agriculture reported that oil extraction rates have improved to 18% across key olive varieties, including Picual, Gerafa, and Saint Catherine, compared to previous levels below 10%. This achievement follows three years of efforts to enhance harvesting techniques and introduce specialized presses to improve oil quality. The progress underscores Iraq’s growing potential in the olive oil industry, positioning the country as an emerging player in the market.
Morocco's olive oil industry faces prolonged drought, leading to reduced domestic production and soaring local prices, with a liter (L) exceeding USD 10.31/L (MAD 100/L) by the end of 2023. Despite these challenges, exports to the EU surged early in the 2024/25 harvest, reaching 841 tons between Oct-24 and Nov-24, up from 553 tons in the same period last year. However, the EC projects Moroccan production to decline to 90 thousand tons this season, down from 106 thousand tons in 2023/24. In response, farmers are increasingly adopting drought-resistant olive varieties such as Arbosana and Arbequina to enhance yields and sustain the industry amid ongoing climate challenges.
Spain faces uncertainty as the United States (US) considers new tariffs on foreign products starting April 2, 2025. With the US importing around 180 thousand tons of Spanish olive oil annually, the industry is particularly concerned about potential price increases that could benefit competitors like Tunisia, Morocco, Syria, and Turkey. While American production remains low at approximately 12 thousand tons annually, higher tariffs could impact US consumers and shift market dynamics. Despite these challenges, Spain is likely to maintain its dominant position in global olive oil exports.
Spain's olive oil prices sharply declined following a period of record-high costs driven by poor harvests and adverse weather. With production increasing from 850 thousand tons to 1.4 million tons, supermarkets have been able to lower prices, making olive oil more affordable for consumers. Notably, Mercadona has reduced the price of a 3L bottle of extra virgin olive oil to USD 18.07/3L (EUR 16.65/3L), bringing the cost down to USD 6.03/L (EUR 5.55/L). This trend offers financial relief to Spanish households while ensuring the continued accessibility of this Mediterranean staple.
In W10, olive oil prices in Spain remained steady at USD 4.32 per kilogram, with a 1.37% month-on-month (MoM) decline and a significant 54.72% year-on-year (YoY) drop. This substantial decrease is primarily due to a notable increase in production, rising from 850,000 tons to 1.4 million tons, which has alleviated previous supply constraints and led to lower prices. Additionally, the potential implementation of new US tariffs on imported goods, including Spanish olive oil, has created uncertainty in the market, prompting concerns about reduced export demand and further price pressures.
In W10, Italy's olive oil prices experienced a slight increase of 0.17% week-on-week (WoW)to USD 11.53/kg, marking a 20.99% MoM rise and an 8.06% YoY increase. This upward trend is primarily due to a significant decrease in domestic production, with forecasts indicating a 25.8% decline in Italy's olive oil output for the 2024/25 season. The reduced supply has tightened the market, exerting upward pressure on prices. Additionally, Italy's strategic initiatives to enhance olive oil production, such as planting 5 thousand hectares (ha) of new olive groves, aim to bolster future yields but have yet to impact current market conditions. Despite these efforts, the present supply constraints continue to drive prices upward.
In W10, olive oil prices in Greece surged by 10.28% WoW to USD 4.72/kg, with an 11.32% MoM increase. This rise is due to heightened domestic and international demand, alongside increased production costs, including higher wages and input expenses. However, YoY prices dropped significantly by 61.95%, reflecting the substantial increase in production from the previous year's drought-affected levels.
Tunisia's olive oil prices increased by 17.71% WoW to USD 4.12/kg in W10, showing a 19.49% MoM surge due to stronger export demand, particularly from key markets like the EU and the US. Additionally, logistical constraints and rising processing costs have contributed to the upward price trend. However, olive oil prices dropped by 50.26% YoY due to the significant increase in production, driven by improved climatic conditions and expanded irrigation practices, which have boosted Tunisia’s olive oil output for the 2024/25 season.
Spanish olive oil producers and exporters should capitalize on the price drop by promoting bulk sales and expanding into price-sensitive markets. Retailers can introduce promotional campaigns highlighting affordability, while exporters can target emerging markets where high costs previously limited demand, such as Latin America and Southeast Asia.
Spanish olive oil exporters should strengthen trade relationships in alternative markets like Latin America, Japan, and Southeast Asia to offset potential losses from US tariffs. Expanding distribution through retail partnerships and e-commerce in these regions can help maintain sales volume. Additionally, promoting premium and organic olive oils in high-value markets can enhance profitability despite trade restrictions.
Sources: Tridge, Asajajaen, Freshplaza, Okdiario, Rue 20, Shafaq News, The Objective
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