Olive oil prices in Spain will remain at record levels at least until June after a drought hit the south of the country for the second year in a row, Deoleo, the world's largest olive oil producer, said.
Production in the 2023/2024 crop year is expected to be about a third below the four-year average, according to official figures, cutting supply and driving up prices.
Spain is the world's top olive oil producer, supplying about 40% of the world's output, making it a reference for international olive oil prices.
"I don't expect the current higher prices to go any further than they are at the moment... but we do expect olive oil prices to ease for consumers from June 2024," Deoleo CEO Ignacio Silva told reporters on the sidelines of a retailer business event in Madrid.
Olive Oil Prices
The price of extra virgin olive oil has doubled in Spain since the beginning of the year, reaching €8.10 ($8.54) per kilo in the first half of October, according to official figures. The prices are 155% higher than in the same period two years ago.
Spain's agriculture ministry expects olive oil production to reach 765,300 metric tonnes in the 2023-2024 harvest, up from 663,000 tonnes in 2022-2023 when output halved, but still a third below the four-year average.
Deoleo, which operates brands such as Bertolli and Carbonell, is more optimistic, predicting that the new harvest that started on 1 October could reach 800,000 metric tonnes if there is more rain in the spring, which could result in farmers lowering prices.