The Growing Pains of Albania’s Ascendant Olive Oil Sector

Albania is poised for an olive oil pro­duc­tion rev­o­lu­tion, but lead­ing experts and pro­duc­ers worry that qual­ity may not keep pace.

According to Mivan Peci, a con­sul­tant for the Albanian Olive Oil Association and food engi­neer at Musai Olive Oil, the coun­try has pro­duced an annual aver­age of 20,670 tons of olive oil in the past three years. Before 2020/21, annual pro­duc­tion hov­ered between 10,000 and 13,000 tons.

“From 2009 to 2013, the Albanian gov­ern­ment invested a lot of money in the olive oil sec­tor,” Peci said.

The gov­ern­ment iden­ti­fied olives as a strate­gic crop since the trees grow well in the country’s Mediterranean cli­mate and olive cul­ti­va­tion does not require the same cap­i­tal or labor as other crops.

According to Peci, the num­ber of olive trees in the coun­try has increased by 30 per­cent, with many new trees – mostly the local Kalinjot vari­ety and Frantoio from Italy – enter­ing full matu­rity in 2021/22. He antic­i­pates pro­duc­tion will con­tinue to increase over time.

“The increase in pro­duc­tion in the past three years is due to the increase in the num­ber of trees pro­duc­ing olives,” agron­o­mist Bruno Musaj con­firmed. ​“Albania went from eight mil­lion trees pro­duc­ing olives to about 12 mil­lion.”

(Musaj spoke to Olive Oil Times through two trans­la­tors in sep­a­rate inter­views: Bianti Danaj, founder of Donika Olive Oil, and Kejda Musaj, his sis­ter and mar­ket­ing man­ager of Musai Olive Oil. He is head of pro­duc­tion for both com­pa­nies.)

“The gov­ern­ment helped many Albanian farm­ers through grants to increase their pro­duc­tion and adopt bet­ter olive cul­ti­va­tion, pro­duc­tion and stor­age meth­ods,” Musaj added. He also expects pro­duc­tion to con­tinue ris­ing in the com­ing years.

According to Danaj, mar­ket forces also con­tributed to ris­ing pro­duc­tion. As global demand for olive oil increased, many Albanian farm­ers found grow­ing olives appeal­ing. At the same time, the gov­ern­ment also invested in new olive mills to increase the qual­ity of olive oil pro­duced.

“As of 2022, there were 480 pro­cess­ing lines in Albania, of which 160 are new, with new tech­nol­ogy – mostly from Pieralisi and Alfa Laval – and they pro­duce high-qual­ity extra vir­gin olive oil,” Peci said.

Olive oil yields are trend­ing upward, but pro­duc­tion in the 2023/24 crop year is antic­i­pated to decrease for a sec­ond con­sec­u­tive year. After reach­ing a record-high 26,000 tons in 2021/22, pro­duc­tion fell to 20,000 tons in 2022/23 and is expected to reach just 16,000 tons in the cur­rent har­vest.

“The pro­duc­tion decline is mostly explained by cli­matic fac­tors,” Peci said. Over the past two years, the his­toric drought expe­ri­enced across the Mediterranean basin pre­vented most of the trees from devel­op­ing new buds, lim­it­ing the amount of olives they could bear.

Along with the drought, Peci said Albania nor­mally expe­ri­ences large swings between the ​‘on’ and ​‘off-years’ in the nat­ural alter­nate bear­ing cycle of the olive trees due to poor agro­nomic prac­tices.

While there has been some improve­ment in recent years, Peci said most farm­ers are still not using the best prun­ing tech­niques, fer­til­iz­ing their olive trees or remov­ing unhar­vested fruits, all of which have con­tributed to the con­sec­u­tive pro­duc­tion declines.

Musaj also wor­ries that the gov­ern­men­t’s sig­nif­i­cant invest­ment in mod­ern mills has not been accom­pa­nied by ade­quate train­ing pro­grams, mean­ing many infor­mally trained millers will not get the most out of their mod­ern equip­ment.

These fac­tors are all part of the grow­ing pains that Peci, Musaj and oth­ers believe the Albanian olive oil sec­tor faces.

One of the main obsta­cles to over­com­ing these grow­ing pains is the highly frag­mented nature of the country’s olive farms, most of which are located in the hilly regions of Vlorë County in the south.

“In 1990, the gov­ern­ment gave each fam­ily 1.2 hectares of land, so it is very dif­fi­cult to har­vest effi­ciently,” Musaj said. ​“Additionally, most of the Kalinjot trees are located in the hills, so it is almost impos­si­ble to do machine har­vest­ing.”

Peci said the solu­tion to this prob­lem would be for farm­ers to form coop­er­a­tives and asso­ci­a­tions, low­er­ing pro­duc­tion costs and allow­ing farm­ers to invest in mech­a­niz­ing the har­vest.

For its part, Danaj said Donika Olive Oil only pur­chases hand-har­vested cer­ti­fied organic olives, which are milled within three hours. As a result, he cites find­ing enough labor as another chal­lenge the com­pany has faced in recent years.

“A lot of Albanians that would have worked on these farms have migrated because they want a bet­ter life in Western Europe or the United States,” Danaj said. The exo­dus of work­ers has resulted in short­ages, forc­ing com­pa­nies to pay higher wages and increas­ing the cost of pro­duc­tion.

Due to Albania’s pre­vail­ing olive oil cul­ture and eco­nomic sit­u­a­tion, Danaj said that most Albanians are unwill­ing to pay high prices for local extra vir­gin olive oil.

“Albania pro­duces a lot of olive oil [for a coun­try with fewer than three mil­lion peo­ple], and every­body has some type of con­nec­tion to a per­son who pro­duces olive oil,” he said. ​“Since olive oil is abun­dant, it’s very hard to dif­fer­en­ti­ate or to tell peo­ple that our olive oil is bet­ter than your uncle’s olive oil.”

As a result, Danaj focuses on exports and is cur­rently in talks with part­ners in the United Kingdom, Australia and the United States, not­ing that inter­est has also come from China and Japan.

Musai Olive Oil, which has a mod­ern mill located amidst neigh­bor­ing olive groves, fol­lows a very sim­i­lar busi­ness model. The com­pany, which pro­duced the award-win­ning The Illyrian Press brand, also exports to the U.S. and north­ern European coun­tries.

However, high olive oil prices over the pre­vi­ous two years have also ham­pered efforts to pro­mote indi­vid­ual-pack­aged extra vir­gin olive oil exports.

These prices have incen­tivized farm­ers to focus on quan­tity over qual­ity. The vast major­ity of this olive oil is exported in bulk to Italy to be pack­aged and resold.

Even Donika and Musai took advan­tage of the sit­u­a­tion. ​“Market prices have been very good for the aver­age Albanian farmer,” Danaj said.

Peci sees two pos­si­ble solu­tions to the prob­lem of high pro­duc­tion costs, which con­tribute to lower domes­tic sales.

“For more than 10 years, the Albanian gov­ern­ment has not sub­si­dized the pro­duc­tion of extra vir­gin olive oil,” he said. Previously, the gov­ern­ment gave pro­duc­ers the equiv­a­lent of €1 per liter of extra vir­gin olive oil pro­duced.

“This does not push farm­ers and mills to strive for high-qual­ity olive oil,” Peci added. ​“Subsidizing high-qual­ity pro­duc­tion may lower the price for inter­nal con­sump­tion as well.”

The other solu­tion is lob­by­ing to cre­ate an Albanian Protected Designation of Origin (PDO), which he said would add value to the prod­uct and the Kalinjot vari­ety. The coun­try already has 36 wines pro­tected by the European Union with PDOs.

Along with Peci and the Musaj sib­lings, Danaj believes Albania must cre­ate a cul­ture around high-qual­ity extra vir­gin olive oil pro­duc­tion focussed around the Kalinjot, which is nat­u­rally high in polyphe­nols and fea­tures a dis­tinct robust fla­vor with accen­tu­ated earthy and bit­ter notes.

“We hope to shine light on our pre­cious Kalinjot olive vari­ety, which can­not be found any­where in the world but Albania, and holds a unique story and sig­nif­i­cance to our cul­ture,” Danaj con­cluded.