Rising Prices Accompany Off-Year Harvest in Australia

Extra vir­gin olive oil prices in Australia have surged to unprece­dented lev­els recently.

A visit to Melbourne super­mar­ket shelves revealed that medium-qual­ity extra vir­gin olive oil can now cost more than 25 Australian dol­lars (€15) per liter.

In recent months, the price of imported extra vir­gin olive oil has sig­nif­i­cantly sur­passed prices for Australian-made prod­ucts, revers­ing a long-stand­ing mar­ket trend.

However, there are indi­ca­tions that these ris­ing price trends may soon taper off, includ­ing a favor­able yield for most Australian olive oil pro­duc­ers in the recent har­vest and an antic­i­pated recov­ery in European olive oil pro­duc­tion for the upcom­ing sea­son.

“The har­vest was near what was expected,” Michael Southan, chief exec­u­tive of the Australian Olives Association (AOA), told Olive Oil Times.

“It was an off-year, so we were expect­ing yields to be lower, but it was bet­ter than the pre­vi­ous off-year in 2022,” Southan explained, refer­ring to the nat­ural alter­nate bear­ing cycle of the olive tree.

“In some areas, frosts or hot winds at flow­er­ing resulted in lit­tle to no fruit set, but luck­ily, this was not the case for the major olive grow­ing areas,” he added.

Some dam­age came from the olive lace bug. Though the bug can cause olive trees to lose their leaves, its impact was milder than antic­i­pated.

“It was an issue for some small groves par­tic­u­larly, as this pest has not impacted them in the past,” Southan said. ​“Still, it is a native insect which has been around for many years. The cooler and wet­ter pre­ced­ing sum­mer suited the olive lace bug in increas­ing its num­bers.”

While large olive oil pro­duc­ers may ben­e­fit from economies of scale to off­set ris­ing pro­duc­tion costs, smaller pro­duc­ers often face a dif­fer­ent sit­u­a­tion.

Natural events were just one of many chal­lenges faced by Australian pro­duc­ers of high-qual­ity olive oil.

“The har­vest was smaller than most years. That was due to the drought and the weather hit­ting the flow­er­ing. On top of that, we did a major prune last year,” said Anne Ashbolt, co-owner at Ashbolt Farm, the south­ern Australian island of Tasmania.

“In Australia, it is always about the labor and the cost of prun­ing and har­vest­ing,” she added. ​“Larger groves can use the mas­sive Colossus machines. Smaller groves like ours, pick the olives with hand­held rakes.”

Several other pro­duc­ers of high-qual­ity extra vir­gin olive oil also pointed to the ris­ing pro­duc­tion costs as a chal­lenge they have faced this year.

“Post-Covid, the biggest chal­lenge has been stay­ing within bud­get, par­tic­u­larly with ris­ing labor and con­sum­able costs,” said Stephen and Sui Tham, own­ers of Cape Shanck Olive Estate.

The farm, located in the south­east­ern cor­ner of Australia’s main­land in Victoria, also had to deal with severe weather con­di­tions.

“The late spring heavy down­pour coin­cided with the flow­er­ing period. This really affected the amount of fruit in the trees,” Tham said. ​“Following a dry and fairly warm sum­mer, the tem­per­a­tures plum­meted and were accom­pa­nied by fre­quent and occa­sional heavy rains affect­ing the ripen­ing of our fruit.”

Interestingly, the har­vest started later than usual, begin­ning in mid-May with the first Leccino trees.

“The quan­tity har­vested was gen­er­ally lower than pre­vi­ous years, not unex­pected given the effects of the spring rains,” Tham said.

These unusual con­di­tions also impacted other vital aspects of extra vir­gin olive oil pro­duc­tion. ​“In gen­eral, the olive oils of our five vari­eties were milder, unusu­ally so for the Picual and Picholine vari­eties. It might cer­tainly suit some palates,” Tham said.

In north­ern Victoria, grow­ers encoun­tered spring freeze episodes that neg­a­tively impacted pro­duc­tion.

“Our har­vest was sat­is­fac­tory,” said John Symington, owner of Oasis Olives. ​“We had lost a lot of flow­er­ing due to frost last spring, so we had lower than usual expec­ta­tions, and the har­vest came in with a result towards the lower end of the range of expec­ta­tions.”

“Climate is always a com­pli­cat­ing fac­tor as it is dif­fer­ent every year. This sea­son is a very benign sum­mer as the fruit ripened, result­ing in milder than usual oils,” Symington added. ​“Climate is beyond our con­trol, but we look to chang­ing the mix of vari­eties in our best olive oils to make them a lit­tle more com­plex or robust depend­ing on the con­di­tions.”

Symington noted that chal­leng­ing olive sea­sons add fur­ther com­plex­ity to olive oil pro­duc­tion.

“Trying to ensure qual­ity always involves some trade-offs. If it is a choice between har­vest­ing early for qual­ity or later for quan­tity, we are happy to choose qual­ity, but it is not always so clear cut,” he said.

“If we har­vest our pre­mium vari­eties such as Coratina or Picual very early for a par­tic­u­larly good olive oil, by delay­ing other vari­eties, we may increase the risk of anthrac­nose down­grad­ing the olive oil from some sus­cep­ti­ble vari­eties such as Leccino or Barnea,” the pro­ducer added.

“It is not logis­ti­cally pos­si­ble to har­vest every­thing as quickly as we would like, so we need to make those trade-offs,” Symington explained.

On the oppo­site side of the coun­try, in Western Australia, farm­ers encoun­tered highly unusual weather con­di­tions, sim­i­lar to recent years in south­ern Europe, with ris­ing tem­per­a­tures and severe drought.

Ian Wildly, the owner of Sherwood Springs, has been man­ag­ing around 1,000 olive trees since 1999, when the farm planted Frantoio, Leccino, Pendolino and Minerva olive vari­eties.

“The most recent har­vest in May 2024 was well below expec­ta­tions,” Wildly said. ​“Rainfall dur­ing the last two win­ters was well below aver­age, and while the trees are irri­gated dur­ing sum­mer, lack of soil mois­ture meant less spring foliage growth. The flow­er­ing was light and patchy.”

“We expect hot, dry weather in sum­mer. But 2023/24 was excep­tional,” he added. ​“Zero rain­fall from October 2023 until May 2024 and extended days of tem­per­a­tures above 40 ºC.”

Wildly also pointed out an emerg­ing prob­lem: dam­age caused by Port Lincoln Ringneck par­rots.

“It is native to Australia and inhab­its the forests in the south­west, feed­ing on flow­ers and fruit of euca­lyp­tus trees,” he said. ​“Recently, they have dis­cov­ered that olives are an easy food source. The par­rots nip off the fruit­ing branch as the olives mature, feed­ing on the fruits and seed on the ground.”

“It is not only the cur­rent year crop that is lost but the fruit­ing branch for the fol­low­ing year,” he added. ​“Lack of ade­quate prun­ing over the years has also con­tributed. This has been addressed by a con­certed effort to pol­lard one or two scaf­fold branches on each tree. Early signs are encour­ag­ing with strong new growth.”

“The local mar­ket is strong, but poor yields gen­er­ally have increased prices, maybe to the point where some con­sumers switch to a cheaper alter­na­tive, such as canola oil,” Wildly warned.

According to Southan, ​“the major oppor­tu­ni­ties with the cur­rent prices for extra vir­gin olive oil are for large agri­cul­tural busi­nesses to diver­sify their oper­a­tions with large grove plant­i­ngs, par­tic­u­larly where they have water avail­able for irri­ga­tion.”

“Challenges exist for smaller busi­nesses where the econ­omy of scale is not suf­fi­cient for them to be as prof­itable as they would like in pro­duc­ing extra vir­gin olive oil,” he con­cluded. ​“Table olives present a great oppor­tu­nity for them.”

• The Guardian