Olive oil prices in Greece remain high, but a glimmer of hope is on the horizon, TA NEA reports. It may take some time, but we anticipate a gradual return to pre-crisis levels, eventually translating into more affordable prices for consumers. A slight drop in producer prices has recently been noted in Greece and Spain, signalling a potential shift in the market. While the journey to lower prices may be long, reducing producer prices is a positive step in that direction. And it all depends on Spain:
- If Spain’s production hits 70%, a considerable price drop might occur due to low global consumption, resulting in oversupply and falling prices. This potential surplus could spark optimism for the future.
- Should the new olive-growing season produce sufficiently, farmers might sell at lower prices to cut losses, while buyers will purchase only what’s necessary. This scenario would favour consumers but challenge producers.
Current Prices for Olive Oil in Greece
The olive oil market has shown signs of stability in recent months, which should reassure stakeholders. Supermarket prices for olive oil range from 10.90 to 18 euros per litre, with organic variants reaching 22.60 euros per litre. Producers are selling extra virgin olive oil for 7.80 to 8.20 euros per litre, a slight decrease from last month’s prices. This stability results from major buyers filling their warehouses, reducing consumption and cautious outlooks for the future.
The decline in producer prices, around 1-1.30 euros, has yet to reach consumers. Giorgos Oikonomou, general director of the Association of Greek Olive Oil Standardization Industries (SEVITEL), cited by TA NEA, explains that this drop is due to expected better price levels in Spain and Greece and reduced consumption.
Manolis Giannoulis, president of the Greek Interprofessional Olive Oil Organization (EDOE), attributes this gap to reduced consumption and buyers holding back on supplies, waiting to see how the new year unfolds.
From the high prices of 9.50 euros per litre, now around 8.30 euros, there’s hope for a reduction to the 5-6 euros range, making the product more attractive to consumers while allowing producers to profit.
Olive oil production in Greece will likely improve, with clearer estimates available by mid-June. The president of EDOE predicts a higher harvest than last year’s historic low.
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Why Spain Will Influence Olive Oil Prices
Spain, a significant player in the global olive oil market, has the potential to impact prices significantly. Initially, Spain forecasted a production of 740,000 tons, but the actual production exceeded expectations at 850,000 tons. Spain’s production potential in a good year exceeds 2 million tons, so a 50%-60% production rate for the new year seems feasible. If production in Spain reaches 70%, we may see a significant price drop due to low global consumption, leading to an oversupply and reduced prices. This potential increase in supply should inspire optimism for the future.
Another scenario suggests that if the new olive-growing season yields sufficient production, producers might sell at reduced prices to minimize losses, while buyers will only purchase what they immediately need. This situation would benefit consumers but leave producers struggling.