The Secrets to Successful Olive Oil Production in Peru

As pro­duc­ers across the Southern Hemisphere gear up for the fast-approach­ing 2024 har­vest, the man behind Oasis Olives sits in a unique posi­tion.

Founder John Symington has fol­lowed an unusual path that took him from the world of infor­ma­tion tech­nol­ogy to plant­ing olives in cen­tral Peru and later Australia.

“My back­ground wasn’t in agri­cul­ture. I was in IT,” Symington told Olive Oil Times. ​“I had a com­puter soft­ware com­pany that I sold and was look­ing for some­thing worth­while.”

He wanted to invest in a project that would ben­e­fit peo­ple and the planet and gen­er­ate a return on invest­ment. Symington finally set­tled on plant­ing olive trees to cap­ture car­bon and gen­er­ate local employ­ment in the Peruvian desert.

(The name for Oasis Olives comes from the small oases found in the desert of cen­tral Peru, indi­cat­ing the pres­ence of under­ground water reserves.)

“The project in Peru was pro­posed to me by some­one that I knew, and I was igno­rant enough to think, ​‘Yeah, let’s go ahead and do it,’” he said.

Originally, Symington planned to be a pas­sive investor. The con­tact that had pre­sented him with the project pro­posal also intro­duced a man­age­ment and agron­omy team, while Symington was to pro­vide the cap­i­tal.

“I went to Peru peri­od­i­cally, but I saw dead trees every­where, and it was clear that there were some major prob­lems, so I got involved,” Symington said. ​“If I was look­ing at purely this invest­ment, I prob­a­bly should have would have walked away except for stub­born pride.”

Symington hired a new local man­ager and agron­o­mist to run the oper­a­tion but also decided that he needed to learn more about olive farm­ing and oil pro­duc­tion him­self.

“I bought a run-down grove in Australia to restore and go through the whole process of har­vest­ing, putting in a mill and pro­duc­ing oil before we got to that same stage in Peru so I could learn in Australia and make sure things were being done prop­erly in Peru,” he said.

The first Australian olive grove was planted near Kialla, Victoria, a few hours north of Melbourne. Since then, Oasis Olives has also started farm­ing and milling oper­a­tions in Western Wimmera, slightly less than 400 kilo­me­ters west of Kialla, and Mallee, South Australia.

About half of the company’s olive oil is pro­duced in Peru – 700,000 liters in a good year. Most of this pro­duc­tion is exported in bulk to the United States and Australia.

Symington said the idea to plant near Pisco, about 500 kilo­me­ters north­west of the country’s his­toric olive grow­ing region, was rec­om­mended by local author­i­ties and his first agron­o­mist mainly due to water avail­abil­ity in the area.

“I went out there, and we talked to the author­i­ties,” he said. ​“Their advice was to go to Pisco prin­ci­pally because water was avail­able there. Water is essen­tial in that part of Peru because it doesn’t rain, so you’ve got to have access to the aquifers.”

“As it hap­pened, it’s not a good area, and we’ve had to find ways to manip­u­late the trees to get them to flower reli­ably because it does­n’t have cool enough tem­per­a­tures dur­ing the win­ter,” Symington added.

Initially, the agron­o­mist sought olive vari­eties that require fewer chill hours, know­ing early on that high win­ter tem­per­a­tures could be a prob­lem. However, the vari­eties he selected did not bear fruit.

“We dis­cov­ered by acci­dent that if you gir­dle the trees, you can give them a bit of a push to com­pen­sate to some extent for lack of chill­ing,” Symington said.

Girdling the olive trees entails cut­ting off a thin strip of bark all the way around the trunk. ​“That is how the canopy feeds the root sys­tem,” Symington said. ​“Girdling traps some of the energy in the canopy at about the time of flow­er­ing, and that’s enough to push the tree into giv­ing you some decent flow­er­ing.”

Symington acci­den­tally stum­bled upon the solu­tion after walk­ing through the olive grove one Sunday. ​“I found a branch that had been caught between two other branches,” he said. ​“The bark had been rubbed off, and it was the only branch on the tree with decent flow­er­ing.”

After con­sult­ing with Leandro Ravetti, now the co-chief exec­u­tive of Cobram Estate, Symington learned that girdling was prac­ticed in other parts of the olive grow­ing world to achieve one-off pro­duc­tion increases but was not widely used as a method to mit­i­gate the impact of a lack of chill hours.

Oasis Olives now uses the prac­tice reg­u­larly to ensure pro­duc­tion in its Peruvian groves. ​“Some other grow­ers in Peru have adopted it as well,” Symington said.

While the com­pany has not needed to gir­dle in its Australian groves yet, Symington said Peru’s higher annual aver­age tem­per­a­ture pro­vides a peek at what the olive groves in Australia could face in the most extreme cli­mate change sce­nar­ios.

“Being in Peru, where we do have an issue with warm tem­per­a­tures, per­haps is help­ing us to be more aware in Australia of what cli­mate change could bring us in the future,” he said.

Along with high win­ter tem­per­a­tures, Symington cited polit­i­cal insta­bil­ity as one of the chal­lenges Oasis Olives faces in pro­duc­ing olive oil in Peru.

“We’ve had instances in Peru where our work­ers haven’t been able to get to the farm because there have been riot­ers block­ing the high­way,” he said. ​“It is cer­tainly some­thing we don’t have to deal with in Australia, and it does make Peru a lit­tle bit more unpre­dictable and prob­lem­atic to man­age.”

Ahead of the cur­rent har­vest, Oasis Olives is also con­tend­ing with ris­ing energy prices in Peru after a short-term lack of rain in the moun­tains low­ered the avail­abil­ity of the coun­try’s pre­vi­ously pro­lific hydro­elec­tric­ity reserves. Meanwhile, higher gas prices also pushed up the price of the main alter­na­tive power source.

While labor costs are much lower in Peru, Symington said they aver­age out with those expe­ri­enced by Oasis Olives’ groves in Australia due to lower pro­duc­tiv­ity and the lack of mech­a­niza­tion.

“Labor costs are low in Peru, but you need a lot more labor,” he said. ​“We have quite a lot of staff in Peru for what we do,” he said. ​“There are some jobs we don’t mech­a­nize as much in Peru as in Australia.”

“We also need to have some secu­rity staff. We also have a kitchen and kitchen staff to cook peo­ple break­fast and lunch,” he added.

Along with the extra staff, Symington said there are other admin­is­tra­tion costs and the com­pli­cated tax­a­tion sys­tem to nav­i­gate, requir­ing a larger office staff. ​“All of those things add up,” he said.

While ris­ing costs have been off­set some­what by increas­ing global olive oil prices at ori­gin, Symington said Oasis Olives has not enjoyed the full ben­e­fit of the price hikes.

“Most of our oil is sold in advance, and we had some uplift, but the small increases we saw for our last sea­son were prob­a­bly cov­er­ing increases in fer­til­izer, labor, diesel now also power costs,” he said.

“We were still a long way below mar­ket prices because we’d set prices in advance and also try to cush­ion exist­ing cus­tomers some­what from the impact,” Symington added. ​“We’re hop­ing that the prices will stay high for a lit­tle while, and we can start to ben­e­fit. Until now, the ben­e­fit has been min­i­mal.”

Despite the orig­i­nal plan to be a pas­sive investor in Peru, Symington remains ded­i­cated to the company’s olive farm­ing and milling oper­a­tions there.

Until the Covid-19 pan­demic, he would visit twice yearly to inspect the groves before the har­vest and dur­ing the milling sea­son.

However, these bian­nual vis­its ended at the onset of the pan­demic in 2020, which rav­aged Peru. According to Johns Hopkins University’s coro­n­avirus resource cen­ter, Peru expe­ri­enced the high­est num­ber of deaths attrib­uted to the dis­ease per 100,000 peo­ple (665.84) and the high­est observed case-fatal­ity ratio (4.9 per­cent) glob­ally.

Between 2020 and 2023, when the cen­ter stopped col­lect­ing data, Peru endured 219,539 deaths. ​“One of our senior staff mem­bers died of Covid-19, and every­body lost friends and rel­a­tives to Covid-19,” Symington said.

Still, the olive har­vest and pro­duc­tion could con­tinue due to the company’s sta­tus as a food pro­ducer.

Symington attrib­uted the company’s abil­ity to over­come the chal­lenges of the 2020 har­vest to its milling tech­ni­cian, Alberto Serralha. ​“His Portuguese team and our local team made sure the har­vests were com­pleted suc­cess­fully dur­ing Covid-19,” he said.

“Alberto, in par­tic­u­lar, orga­nized visas for his team to get them into a shut­ting-down coun­try and kept them going in Peru when other for­eign­ers were catch­ing evac­u­a­tion flights, not know­ing whether there would be more evac­u­a­tion flights to get them home,” Symington added. ​“They were very lucky to get out on a Dutch gov­ern­ment evac­u­a­tion flight right at the end of the har­vest.”

Looking ahead to 2024, Symington expects a poor har­vest in Peru. Officials in the coun­try expect pro­duc­tion to be quite low, rang­ing from 700 to 1,000 tons.

Meanwhile, Symington expects the har­vest in Australia to be ​“sig­nif­i­cantly down” from last year as well, partly due to many groves enter­ing an ​‘off-year’ in the nat­ural alter­nate bear­ing cycle of the olive tree.

“There was a late frost about a week before flow­ers were open­ing that has impacted pro­duc­tion through­out South Australia,” he added. ​“Our crops are not dis­as­trously impacted, but they’re down. A lot of other peo­ple are down more than us.”

Despite this season’s expected set­backs, Symington is con­fi­dent that pro­duc­tion will con­tinue to rise, espe­cially as he plants more in Australia.

“We’ve done a lot of new plant­ing in Australia,” he said. ​“We’re still ramp­ing up pro­duc­tion in Australia, which will be big­ger than in Peru. But at the moment, they’re prob­a­bly about on par with each other.”

Despite his admit­ted naivete when enter­ing the indus­try 15 years ago, Symington has no regrets and looks for­ward to the future.

“It’s a good indus­try to be in, but peo­ple are not in the indus­try to make a quick buck,” he said. ​“We’re mak­ing a healthy prod­uct. We’re mak­ing a good qual­ity prod­uct, and we are prof­itable.”

“So I’m happy to be in the olive oil indus­try, and I feel pos­i­tive about where we are at the moment, and I feel pos­i­tive about where we’re going,” Symington con­cluded.