Europe almost out of local olive oil supplies, prices soar nearly 50%: Report

It had been anticipated for a few months but it looks almost certain that Europe might run out of local olive oil supplies and face frequent shortages. The extreme heatwave across Europe, especially the Mediterranean has damaged harvests for the second year in a row.  

According to a Guardian report, Europe, the world's largest producer of olive oil has been forced to rely on South America to plug the gap by importing supplies. 

“Today it is almost physically impossible to buy olive oil. It is sold out,” Walter Zanre, the chief executive of the UK arm of Filippo Berio. 

Spain, which produces about half of the global olive oil crop, only harvested 750,000 tonnes, more than the 660,000 produced last year but well short of the 1.3 million tonnes target.

Consequently, the global production is expected to fall to 2.4 million tonnes. Last year's global demand stood at three million tonnes and it looks highly unlikely that production will reach that level. 

Apart from Spain, other important olive oil-growing regions such as Greece, Italy, Portugal, Turkey and Morocco were also hit by extreme weather conditions, affecting the crops. 

Italy had been planning to produce 350,000 tonnes of olive oil this year but drought and recent hailstorms in the major producing area of Puglia have shattered any such hopes. 

Meanwhile, Greece is expected to produce only 200,000 tonnes this year which is a third less than last year as fruit fly infestations, in addition to the heatwave cause problems for the farmers. 

“We have been saddled with another difficult year. During the early part of the summer we thought things might get better but as the summer has progressed things have got worse," added Zanre. 

“We’re looking at production rates being cut by half this year. The imbalance in demand and supply has already led to very big price increases, which producers are enjoying but which are very much hurting consumers.

The fear of shortage has already hit the supermarkets. The cost of extra virgin olive oil in southern Spain has shot up to €8.45 per kg this month which is double the price of last year and the highest it has been in the last two decades. 

Meanwhile, in the UK analysts at Associa remarked that retail prices of olive oil at major supermarkets have climbed 47 per cent in recent weeks.