Wildfires and extreme heat have destroyed olive harvests in Europe, leading to olive oil shortages. To keep up with demand, olive oil is imported from South America.
Over the past few years, extreme weather conditions, fires and drought have devastated olive harvests to such an extent that there is almost no local supply of olive oil left in Europe. In Spain – the source of half the world’s olive oil supply – producers have only about 115,000 metric tons of available olive oil supplies, according to analysts at commodity data group Mintec. For comparison, the monthly withdrawal rate is approximately 60,000 tons.
Oil is running out
“If the rate of depletion continues, market insiders warn that olive oil supplies could be depleted before the fresh harvest, which traditionally begins around October in Spain,” Kyle Holland, an edible oil analyst at Mintec, told Business Insider .
To keep up with demand, European companies are importing olive oil from South America, as the world’s top producer has taken notice.
According to the International Olive Council, global olive oil production is expected to more than halve this year to 2.4 million tonnes, below demand of 3 million tonnes. However, in the case of Spain, production forecasts are at 650,000 tonnes, well below the usual 1.3 million.
The drought also affected olive growers in other regions of the Mediterranean, from Greece to Morocco and Italy. Greece is expected to produce just 200,000 tonnes of olive oil this year, one third less than last year.
Countries such as Tunisia, Turkey and Syria have announced olive oil export bans to protect the commodity from high international prices.