`Farmgate Prices Up 20 Percent in Spain - Olive Oil Times
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Farmgate Prices Up 20 Percent in Spain

By Charlie Higgins
Jul. 22, 2014 16:42 UTC

Spanish olive oils have expe­ri­enced price increases of over 20 per­cent on pre­dic­tions of a weak upcom­ing har­vest, accord­ing to El Pais. Currently extra vir­gin olive oil is pric­ing at 2.20 euros/kg, while lam­pante or lower qual­ity oil is pric­ing at 1.65 euros/kg.

Supplies remained strong in early June at around 1,015,000 MT, but a scarcity of spring rains has local agri­cul­tural orga­ni­za­tions fore­see­ing a drop of between 800,000 and 900,000 MT in the next har­vest. This would rep­re­sent more than a 50 per­cent decrease from the pre­vi­ous har­vest, which was among the most prodi­gious on record.

Agustín Rodríguez, UPA

In Jaén, which pro­duced 42 per­cent (740,000 MT) of the national pro­duc­tion and half of Andalusia’s dur­ing the last har­vest, the Small Farmers Union (UPA – Unión de Pequeños Agricultores) has pre­dicted an upcom­ing har­vest of less than 300,000 MT, rep­re­sent­ing a 60 per­cent decrease. If their pre­dic­tions are right, Jaén’s har­vest would be even weaker than the one recorded two years back.

“Even if it does rain there’s no fruit on the trees. So the sit­u­a­tion can’t actu­ally improve, though it could worsen,” said Agustín Rodríguez of the UPA.

The pre­vi­ous olive oil cam­paign broke records with a pro­duc­tion of 1,773,000 MT, keep­ing prices con­sis­tently down and boost­ing domes­tic con­sump­tion by 18 per­cent to 48,000 MT per month. Meanwhile, exports have been his­toric; in the first quar­ter of 2014 Andalucia exported over 198,000 MT of vir­gin olive oil, rep­re­sent­ing a 44 per­cent increase over the same period last year.

Industry mem­bers are now hop­ing the price hikes will help curb sales, par­tic­u­larly those abroad, hope­fully enough to relieve some pres­sure from an upcom­ing har­vest that will be nowhere near as pro­duc­tive as its antecedent.

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