An elderly woman voices a stark concern: the day will come when cooking must be done with water rather than oil. The olive oils from trusted supermarkets sit on shelves, yet the brands typically carried hover around the higher end of the price spectrum. The white-label option is noticeably cheaper, often around seven euros per liter, while premium choices can near nine euros. In a network centered on Barcelona and extending to five other chains, it is uncommon to find five-liter bottles priced under thirty-three euros. Based on price data collected from various sources, the Infaoliva association, which represents Spanish industrial olive oil producers, notes a ten percent price rise in the prior month and a seventy-five percent increase since March. The trend continues for both extra virgin olive oil and related products.
The situation is straightforward in one sense: production is lacking. Harvests have been unusually low, creating a tight outlook for the upcoming campaign starting in October. Rafael Sánchez de Puerta, president of Cooperativas Agro-alimentarias de España’s olive oil sector, explains that reduced product availability forces demand to adjust alongside supply. The recent weeks have seen a surge in oil availability, but it is a signal of the broader supply constraints rather than an improvement in the market.
Families cut olive oil consumption as prices climb
Both Cristóbal Cano, president of the Small Farmers and Farmers Union and head of the Girona Young Farmers Agricultural Association, notes that an overproduction in the previous harvest remains a worrying indicator. If the previous year’s harvest covered roughly 450,000 tons, this year’s harvest has fallen to about 250,000 tons, a level that raises serious concerns for farmers. Drought over two consecutive years has left expectations at around 660,000 tons for the recent period, with a similar figure anticipated a year earlier, affecting the overall supply chain.
Cano describes the 2022-2023 season as ending with the weakest harvest of the 21st century, and forecasts for 2023-2024 indicate a continuation of poor yields. He emphasizes that Spain sits at the top of global olive oil production, accounting for a substantial share of world output, which means these national shortages ripple through international markets and prices. The reality is felt in consumer markets where affordability becomes a key concern.
Demand surpassing available supply
Interprofessional data shows that the European Union anticipates world olive oil production near 2.5 million tons this year, down from just over 3.3 million the year before. This marks the first drop below three million tons in six production cycles. At the same time, global consumption is projected around 2.9 million tons. The combined effect of limited production and steady demand is a steady climb in prices, according to Teresa Perez, a manager within the interprofessional organization.
Sánchez de Puerta adds that early expectations had suggested redundancy would be the major issue as new plantations were established. Instead, the sector now faces a scarcity problem that threatens meeting client demand. The industry has moved away from a narrative of Spain simply producing for others; the reality now is that domestic production faces a shortfall, affecting both growers and buyers alike.
The short-term response remains limited to waiting for rainfall. In the mid term, the sector considers implementing a net irrigation policy and addressing the climate-change impacts on olive groves. Beyond production, the focus includes improving management involvement in adhering to regulations and developing a production-cost index aimed at creating a more real, agile, and responsive structure aligned with current conditions and market fluctuations. This approach, described as a trade-margin observatory, seeks to stabilize the market and support farmers through evolving conditions.