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European producers and exporters have welcomed Brazil's decision to eliminate import tariffs on olive oil, sunflower oil, and several other products. Previously, Europe's olive oil market share in Brazil stood at 9%, and analysts predict this will increase following the tariff removal. In addition to olive oil, tariffs have been abolished on sunflower oil, pasta, rice, meat, coffee, sugar, biscuits, sardines, and corn. The International Olive Council (IOC) reported that Brazil's olive oil consumption has surged from 23,700 tons between 2001 to 2005 to an average of 96,800 tons annually over the past five years. Major EU exporters, especially Spain, Portugal, and Italy, are expected to increase their market share in Brazil, with Portugal supplying 60% of Brazil's imported olive oil and Spain 30% in 2023. A free trade agreement between the European Union (EU) and Mercosur countries, if enacted, could create the largest free trade zone globally, benefiting producers on both sides of the Atlantic.
In 2024, the EU’s agro-food exports reached an all-time high of USD 267.87 billion (EUR 235.4 billion), marking a 3% increase year-on-year (YoY). This growth was largely driven by higher prices, with olive oil exports standing out—rising 41% in value to USD 8.19 billion (EUR 7.2 billion) despite lower volumes, thanks to a 34% price increase. While exports to markets like the UK and US remained strong, overall trade growth outpaced by rising import costs led to an 8% decline in the EU’s agro-food trade surplus.
In the first four months of the 2024/25 campaign (Oct-24 to Jan-25), the value of Spanish olive oil exports fell by 3%, totaling USD 1.95 billion (EUR 1.717 billion), despite a 15% increase in volume, reaching 273,173 tons. This decline in revenue is attributed to a drop in prices, which started in Nov-24. The average export price for Spanish olive oil in Jan-25 was USD 600.84 per kilogram (EUR 528/100-kg), down from USD 908.08/100-kg (EUR 798/100-kg) in Jan-24. Italy remained the largest destination for Spanish olive oil, both in volume (89,619 tons, up 48% YoY) and USD 610.41 million in value (up 15.1% YoY). The majority of exports were extra virgin olive oil (73%). Meanwhile, olive oil imports into Spain remained stable in volume at 87,143 tons but decreased in value by 25%, totaling USD 483.63 million (EUR 425 million), with Portugal being the leading supplier.
While the United States (US) accounts for only 4.7% of Spain’s total exports, the impact of new US tariffs is expected to be moderate overall but potentially significant for strategic sectors such as agro-industry—especially olive oil. In 2024, Spain exported over USD 1.14 billion (EUR 1 billion) worth of olive oil to the US, representing 16.5% of its global sales and making it highly sensitive to trade policy changes. Despite a strong trade surplus of USD 10.013 billion (EUR 10.013 billion) with the US, Spanish fiscal experts (GESTHA) question the legitimacy of the US argument for tariffs based on trade imbalance. Olive oil, a cornerstone of this surplus, not only holds a dominant share by value but also underscores Spain’s leadership in high-value food exports.
Between Oct-24 and Jan-25, Spain imported 87,143 tons of olive oil—virtually identical to the previous year and 7% above the four-year average. However, due to falling unit prices, the total import value dropped by 25% YoY to USD 483.63 million (EUR 425 million), despite being 32% higher than the four-year average. Virgin and extra virgin oils dominated imports with 64% of the volume. Portugal was the top supplier with 57,022 tons (65% share), while Tunisia and Turkey saw increased exports to Spain, the latter benefiting from a strong harvest. Imports from Italy, Egypt, and Greece declined, while Argentina supplied 2,100 tons. Intra-EU imports surged 38% above the average, while Extra-EU volumes fell 23% below their norm, although slightly higher than last season. Despite lower unit values overall, Intra-EU oils remained 27% more expensive than Extra-EU sources.
In Andalusia, Spain’s top olive oil-producing region, farmers in the town of Lopera are protesting plans to install large-scale solar parks that threaten to uproot thousands of olive trees—some centuries old. Renewable energy companies, backed by regional authorities, seek to expropriate up to 1,000 hectares (ha) for solar farms, sparking legal battles and strong opposition from small landowners. Campaigners estimate up to 100,000 olive trees could be lost, with USD 2.62 million (EUR 2.3 million) in annual revenues at risk. While Spain pushes to reach 81% renewable electricity by 2030, locals argue this green transition is sacrificing their agricultural heritage and economic lifeline.
Turkey has achieved a historic milestone in olive production, becoming the world's leader in table olive production with 700,000 tons in 2024/2025. The country also ranks second globally in olive oil production, reaching 475,000 tons. Over the past two decades, Turkey has significantly boosted its olive tree population, growing from 99 million in 2001 to 205 million in 2024. This increase in olive cultivation has translated into a six-fold rise in production, reaching a record 3.75 million tons in 2024, a 150% increase compared to 2023. With this success, Turkey has surpassed strong competitors like Spain and Egypt in the olive industry.
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In W15, olive oil prices in Spain stood at USD 4.27 per kilogram (kg), showing a modest week-on-week (WoW) increase of 1.18%. This rise is attributed to the strengthening of the EUR against the USD, as euro-denominated prices remained stable, but currency fluctuations made the product appear costlier in dollar terms. Despite this short-term gain, prices have continued to trend downward, with a month-on-month (MoM) decline of 4.47% and a sharp year-on-year (YoY) drop of 46.42%, reflecting broader market challenges. The sustained decrease is primarily due to market saturation from a larger-than-expected harvest and weakening global demand, especially after new US tariffs on European olive oil reduced Spain’s export competitiveness. Additionally, structural issues such as an aging farming population and persistently low profitability have increased market volatility. While recent recovery from drought has temporarily boosted supply, long-term risks from climate variability, including water stress and reduced solar radiation, continue to threaten the sector’s future stability.
In W15, olive oil prices in Italy were recorded at USD 10.21/kg, reflecting a WoW increase of 0.89%, with no MoM change and a slight YoY decrease of 0.68%. Despite the minimal percentage movements, Italian prices remain significantly higher than those of other major producers, underscoring the persistent supply-side pressures in the country. Prices have surged over recent months due to a severe production shortfall driven by extreme heat and drought, particularly in major olive-growing regions like Puglia and Sicily. This has sharply reduced harvest volumes, tightening domestic supply. The impact is further compounded by the natural alternate-bearing cycle of olive trees, which limits production in off years, and steady international demand, which continues to support elevated price levels. Although the YoY dip indicates some easing from previous peaks, the structural supply issues continue to keep Italian olive oil prices elevated.
In W15, Greek olive oil prices were USD 4.15/kg, showing a WoW increase of 1.72%, though prices in EUR remained stable—the USD increase was driven by a strengthening of the euro against the dollar. Despite this short-term rise, MoM prices dropped by 11.51%, and YoY prices plunged by 51.29%, reflecting a broader market correction. The sharp decline comes as Greek production has recovered strongly following previous drought-stricken seasons, boosting domestic supply. While export demand has stayed relatively steady and production costs remain high, the normalization of yields and improved harvest volumes have led to downward price adjustments, especially after earlier spikes caused by limited supply. This return to more balanced conditions is helping to recalibrate the market despite the minor recent uptick due to currency effects.
In W15, Tunisian olive oil prices stood at USD 4.35/kg, marking a WoW increase of 0.93%, although prices in EUR remained stable—the increase in USD is attributed to a stronger euro against the dollar. Despite this currency-driven rise, MoM prices declined by 1.58%, reflecting ongoing minor market adjustments. Overall, Tunisian prices have remained relatively steady, supported by strong export demand, particularly from European buyers looking to diversify sourcing amid volatility in other producing countries. However, environmental concerns such as water scarcity and soil moisture deficits pose long-term production risks, and unless mitigated through improved irrigation and farming practices, could eventually pressure supply and pricing.
With Brazil removing import tariffs on olive oil and other agri-food products, European producers—especially from Spain, Portugal, and Italy—should immediately strengthen export partnerships, scale volumes, and push for deeper penetration into the Brazilian market. This policy shift aligns with the anticipated EU-Mercosur Free Trade Agreement, which could further enhance long-term competitiveness. Producers should invest in promotional campaigns emphasizing the quality and origin of their oils, particularly extra virgin, and establish localized distribution networks or joint ventures to reduce logistics costs and adapt to Brazilian consumer preferences. Regional associations like the International Olive Council (IOC) can also support exporters with coordinated branding and outreach to accelerate volume growth in this tariff-free environment.
Spanish and EU producers must mitigate the risks posed by new US tariffs and declining export prices by diversifying their target markets beyond the US and traditional European destinations. Markets such as Brazil (now tariff-free), South Korea, Japan, and the Gulf Cooperation Council (GCC) countries offer growing demand for premium olive oils and fewer trade frictions. Leveraging competitive pricing from recent harvest surpluses and improved freight access, exporters should also develop mid-tier product lines that appeal to health-conscious, price-sensitive segments in emerging economies. Meanwhile, governments should support this pivot with export incentives, trade missions, and bilateral agreements to broaden market reach and absorb surplus inventory.
Sources: Tridge, Agro Popular, BSS News, Daily News Egypt, Financial Food, Manisa Kulis Haber, Oleo, Oli Merca, Vina Net
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