Good news from Spain. Olives have experienced moisture, oil could become cheaper

No other food is talked about as much in Spain as olive oil and its prices. Bargains used to lure consumers to supermarkets in droves, but recently they have become increasingly rare.

According to the Spanish consumer protection association OCU, the price of olive oil has increased by 175 to 225 percent since 2020, depending on the type, Austrian newspaper Der Standard reports. In the first quarter of this year, the prices of unbranded extra virgin oils rose by another seven percent, and the prices of branded ones by up to 23 percent. A liter of extra virgin oil of the cheapest private brands of discount retailers now costs nine to ten euros, roughly 226 to 252 crowns.

Drought is a problem

The reason is the permanent decrease in production caused by the long-term drought in Andalucia in the south of Spain, which is the leading European region in the cultivation of olives. The problem also affects Catalonia in the northeast of the country, where high-quality oils are mainly produced.

“We have to fight the drought while there is still enough water around. When it happens, it will be too late,” said the press spokesperson of the international environmental organization Greenpeace in the past.

Spain is the most important producer of olive oil in the world. Before the drought, annual production was around 1.5 million tons. However, the last harvest amounted to less than 900 thousand tons.

The price increase has also changed consumer behavior. When it comes to frying and deep-frying, many switch to orujo grade oil. This lower quality olive pomace oil is obtained from the olive residues that remain after the extraction of virgin olive oil.

Other consumers choose sunflower oil, which does not have a good reputation in Spain. According to data from the Ministry of Agriculture, sales of orujo oil increased by 45 percent and sunflower oil by less than nine percent.

Hope for a better tomorrow

But now consumer organizations have given consumers hope that olive oil prices will drop. Storm Nelson finally brought rain and snow to Spain in March, so the olive trees are in full bloom in the well-watered soil.

This could lead to a good crop in the coming winter. As oil mills will need empty warehouses for new production, the price of old stocks will fall. It is expected that there will be approximately 150,000 tons left in stock for the transition from the old to the new season. Approximately 90,000 tons are consumed in Spain every month.

Producer prices are also already falling slightly, although this trend has not yet been reflected in supermarkets, and thus to the final consumer. According to the Spanish consumer association OCU, this is likely to happen from June.

However, several risk factors are still at play before a good harvest is achieved. A sudden cold snap would damage the flowers as would a particularly hot spring or extreme summer. The most important period for fruit growth is autumn, so last year’s absence of autumn rain was fatal for the crop.

If it doesn’t rain again in the next few months, irrigation will be necessary. Despite the rain, which has already partially watered the crops, the two most important reservoirs in Andalusia are only about 25 percent full, and in Catalonia they have also declared a state of emergency due to a lack of water.

Water management also plays a role. According to environmental organizations, Spain has the reputation of being the country where water is wasted the most. Outdated irrigation is still used in many areas, and seventy to eighty percent of potable water is used to irrigate arable land.