Bad weather and disease plighted the European olive oil industry last year, causing the retail price of the oil to increase 19.8 per cent, The Financial Times reports.
According to research group IRI, this means that shoppers spent an extra €231 million on olive oil in 2015.
Anne Lefranc, European marketing director at IRI, says that the price increase has affected shoppers, as the "premiumisation" of olive oil may push customers to other products. She notes that “it is a staple product in some countries, but if you go to the UK and other countries, it’s more [a way of] treating yourself”.
The price increase was due to a bacteria outbreak in the southern part of Italy that infected more than a million trees, while Spain also experienced poor harvests. This caused olive oil production to fall 26 per cent in the 2014-15 crop year, according to the International Olive Council.
This dramatic drop in production coincided with an especially large yield in Tunisia, meaning the North African country is currently the top olive oil exporter and second largest producer after Spain.
However, Rabobank analyst Vito Martielli expects prices to ease this year as European growing conditions improve, while Tunisia’s harvest is expected to fall significantly.
© 2016 European Supermarket Magazine – your source for the latest retail news. Article by Brian Dermody. To subscribe to ESM: The European Supermarket Magazine, click here.