`Producer Prices Lowest Since 2009 - Olive Oil Times
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Producer Prices Lowest Since 2009

By Julie Butler
Jun. 7, 2012 21:05 UTC

The lat­est round of European Commission-sub­sidised mar­ket with­drawal of olive oil has failed to rally prices, which the International Olive Council says remain at their low­est lev­els since 2009.

According to its May mar­ket newslet­ter, extra vir­gin olive oil prices are 11 per­cent lower in Spain (€1.77/kg), 10 per­cent in Greece (€1.84/kg) and 39 per­cent in Italy (€2.38/kg), com­pared with the same six months last sea­son,

“In recent months, prices have flat­lined in Greece and remained vir­tu­ally steady in Spain while perk­ing slightly in Italy. Even so, they are at their low­est lev­els since October 2009 in all three coun­tries,” the IOC says.

Prices for refined olive oil are at their worst for the last three crop years and the gap between the price of refined olive oil and EVOO is now about €0.07/kg in Spain and €0.59/kg in Italy.

World olive oil and pomace oil mar­ket

In its April newslet­ter, the IOC described as ​“wor­ry­ing” a decline in olive and pomace oil imports into Canada and Australia. Now it reports that Canadian imports have recov­ered slightly, though they are still down 14 per­cent this October – March com­pared to a year ago, while imports into Australia are up 2 per­cent.

The world’s lead­ing importer, the United States, shows an increase of just 1 per­cent for the first six months of the 2011/12 sea­son, but the fig­ures are more promis­ing for China, Russia and Brazil with respec­tive growth of 22, 16, and 6 per­cent. Earlier this week, the IOC called for ten­ders for a €600,000 ($754,000) pro­mo­tion cam­paign in Japan, where growth is up 7 per­cent.

Imports into and within the EU are also down. The for­mer by 15 per­cent, ​“which comes as no sur­prise given the vol­ume of EU pro­duc­tion this sea­son” the IOC said.

World table olive mar­ket: imports rise in Brazil alone

Table olive imports for October – March are lower for most coun­tries — except into Brazil, where they’ve climbed 23 per­cent. They held steady in Canada but fell 9 per­cent in the US, 4 per­cent in Russia and the EU, and 2 per­cent in Australia.

Argentina: olive oil exports up but con­sump­tion down

This month’s newslet­ter pro­files Argentina, the loca­tion for three IOC meet­ings next month. The 18th extra­or­di­nary ses­sion of the IOC Council of Members will be held in Buenos Aires July 2 – 6, and both the 39th meet­ing of the IOC Advisory Committee and a meet­ing of qual­ity con­trol agree­ment sig­na­to­ries on July 2.

The IOC’s only South American mem­ber, Argentina, joined in 2009. According to Codex Alimentarius doc­u­ments, one of its rea­sons was to ​“show that Argentine olive oils are authen­tic”, even when their fatty acid pro­files dif­fer from the typ­i­cal Mediterranean ones and fall short of IOC para­maters designed to detect adul­ter­ation. Because some oils from Argentina’s new pro­duc­tion areas have low oleic acid val­ues and high linoleic acid ones, it has been push­ing for changes to rel­e­vant para­me­ters.

The IOC newslet­ter, mean­while, says olive oil pro­duc­tion has risen sharply in the last ten years in Argentina ​“albeit more in rel­a­tive terms than absolute terms”, given the 275 per­cent growth amounts to just 11,000 tons.

Exports, largely in bulk and of extra vir­gin grade, have shot up 175 per­cent in a decade. Half go to the US and 40 per­cent to Brazil.

But there’s been a down­turn in Argentine olive oil pro­duc­tion since it reached a high of 27,000 tons in 2007/08, which ​“can very prob­a­bly be explained in part by orchard con­ver­sion to pro­duc­tion for table olives” the IOC said.

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While domes­tic olive oil con­sump­tion slipped 17% in the last ten years, table olive con­sump­tion soared 180 per­cent to reach 35,000 tons last sea­son and table olive pro­duc­tion has hit 250,000 tons. Exports are prin­ci­pally to Brazil.

“Argentina offers excel­lent nat­ural con­di­tions for the devel­op­ment of olive cul­ti­va­tion. Two yard­sticks can be used to mea­sure its poten­tial: the expo­nen­tial growth in the num­ber of advanced genet­ics trees and the growth in Argentine exports, par­tic­u­larly to the two key mar­kets of the United States and Brazil,” the newslet­ter says.

Market with­drawal of olive oil

The EC opened the first ten­der for the lat­est round of pri­vate stor­age aid on May 31 and has already received bids to take a total of more than 86,000 tons of vir­gin olive oil (of which 413 tons is extra vir­gin) off the mar­ket for six months.

In an EC com­mit­tee meet­ing today (June 7) the max­i­mum aid to be paid was fixed at 0.65 €/ton/day, hav­ing taken into account ​“the mar­ket sit­u­a­tion and the struc­ture of the ten­ders received,” EC sources said.

New ten­ders will be accepted until June 19 to bring the total up to the max­i­mum 100,000 tons.


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