The apprehension of olive oil producers in Spain is growing at a decisive moment for olive groves, with the sector divided between the evolution of the weather, the flowering of olive trees and a drop in prices at origin that is once again putting pressure on the profitability of farms.
In Andalusia, concern is concentrated on two fronts: the heat that arrived during the sensitive phase of the olive tree cycle and the drop in olive oil prices. Between May 18 and 24, extra virgin olive oil was traded at 4.04 euros per kilo, according to data from the Poolred system released by the Spanish agrarian organization.
Price approaches a psychological barrier
In the same period, virgin olive oil was priced at R$3.241 per kilo and lampante at R$3.11. In the case of Picual de Jaén, one of the most representative varieties of the main Spanish olive growing region, the extra virgin price even dropped to 3.96 euros per kilo, remaining below the symbolic barrier of four euros.
The drop comes after several weeks of market correction. ASAJA-Jaén itself had indicated, for the period from May 4th to 10th, a value of 4.18 euros per kilo for extra virgin olive oil, which confirms the trend of pressure on prices at origin.
Heat arrives at a delicate stage
The other reason for concern is in the field. Olive flowering and fruit set are phases that are particularly sensitive to heat, and AEMET recorded maximum temperatures in Jaén of 35.3 degrees on May 23rd and 35 degrees on May 24th, high values for this time of year.
This concern has an agronomic basis. The international catalog of olive tree varieties indicates that the flowers are one of the most vulnerable parts to heat stress and that temperatures above 30 degrees can reduce pollen germination and fruit set. Above 35 degrees, the risk of severe damage to flowers increases.
Production still weighs on the sector’s accounts
Despite the uncertainty about the next campaign, available data from the current campaign shows a relevant volume. Accumulated olive oil production in Spain reached 1,294,590 tons as of April 30, according to data from the Food Information and Control Agency cited by the same organization mentioned above.
Total stocks were 863,339 tons, distributed mainly by plants, bottlers and Olivarero Communal Heritage. These numbers show that there is still oil to be disposed of, but also that stocks are decreasing throughout the campaign.
Sector calls for prudence in sales
Cristóbal Gallego, responsible for the olive oil sector at the Agro-food Cooperatives of Andalusia and president of the Jaéncoop group, argued that the moment requires a “cool head”. The director warned that current data does not justify a hasty sale or a devaluation of the product on the market.
In his analysis, accumulated output stood at 869,790 tons and the sector will still have to maintain a significant pace of sales until the end of the campaign. Therefore, Gallego defends prudence, firmness and unity among producers, to prevent one-off operations from artificially putting pressure on prices.
Export and appreciation gain importance
While trying to contain short-term pressure on prices, the Spanish sector continues to focus on international promotion. ASAJA-Jaén says that the Aceites de Oliva de España brand has once again strengthened its presence in China, considered one of the priority markets for the growth of olive oil consumption.
There is also a growing focus on valuing extra virgin olive oil as a product associated with health. The QvExtra membership! launched a certification in Spain that will allow 36 brands to highlight cardiovascular benefits and antioxidant properties on their labels, following scientific analyzes and technical validation in line with European regulations.
Doubt is in the next campaign
The Spanish olive oil sector is therefore entering a phase of difficult balance. On the one hand, prices at origin continue to fall and reduce producers’ margins. On the other hand, the heat in full bloom raises doubts about the real size of the next harvest, especially in Andalusia, a decisive region for the market.
The evolution of the coming weeks will be decisive to see if the market stabilizes or if the pressure continues. For now, producers and cooperatives are trying to avoid hasty decisions, while monitoring the impact of heat on the countryside and seeking to defend the value of a central product in Spanish agriculture.
And in Portugal?
In Portugal, the evolution of the Spanish market is closely monitored, as Spain continues to be the world’s main producer of olive oil and has a strong influence on international prices. According to the International Olive Oil Council, Spanish production should reach 1.419 million tons in the 2024/2025 campaign, while Portugal should reach 177 thousand tons, which shows the difference in scale between the two markets.
Still, the Portuguese sector has gained weight in recent years, largely due to the modern olive grove in Alentejo. The Agro-Food Price Observatory indicates that the olive oil sector represents 860 million euros in national agricultural production, around 8% of the total, and that Portugal has a degree of self-supply of 264.8%, a sign of production clearly above domestic consumption.
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