Olive oil prices are expected to fall significantly in the coming months, with experts predicting a potential 50% drop as the largest producing region in the Mediterranean, Andalusia in Spain, prepares for a bumper harvest.
The end of prolonged drought conditions is expected to increase production by 77%, with the region set to produce approximately 1 million metric tons of olive oil this season.
This increase in production provides relief to UK shoppers, who have faced record high olive oil prices over the past two years. Gary Lewis, of KTC Edibles, one of the UK’s major oil suppliers, expects a significant drop in prices, estimating they could fall by 40-50%. “Prices may return to late 2022 levels, falling from €10,000 (£8,365) per tonne to €4,000-5,000 per tonne,” Lewis said.
Consumers will likely start seeing lower prices soon, with the full impact expected to be felt by the first quarter of 2024. However, the market remains cautious until the crop is harvested and processed.
The price of olive oil in British supermarkets has reached its peak this summer, with the average price of a 500ml bottle reaching £7.89 in August and September, according to Asocia. Recent weeks have seen a slight decline, with the average price now standing at £7.52, as brands such as Napolina and Filippo Berio begin to cut prices.
Kyle Holland, an analyst at Expana, noted that other major olive oil producers such as Greece, Turkey and Tunisia are also preparing for improved yields, which will increase global supply. Greece is expected to produce 230,000 metric tons this season, up from 130,000 metric tons last year, while Turkey and Tunisia also expect significant gains in production.
As the olive harvest season progresses from late October to February, experts agree that increased supply should continue to push prices down, providing much-needed relief to consumers after years of high costs caused by heat waves and drought.