14 Feb, 2019FORTUNE.COM
Olive oil can already be a luxury item, with artisanal varieties commanding upwards of $50 a bottle. But prices of the cooking staple could rise across the board as climate change and extreme weather affects olive harvests worldwide.
The London Times reported Thursday that Italy will run out of olive oil by April. Italian farming lobby Coldiretti said that the domestic olive harvest last fall dropped 57% to 185,000 tons, a 25-year low. That’s only four months’ worth of olive oil.
"We risk for ever losing the chance to consume Italian extra virgin olive oil, which will have disastrous effects on the economy, jobs, health and the countryside," Coldiretti said.
Along with an early cold snap and freak rains, an insect-transmitted bacterium ravaged olive trees in Italy this past year. The Xylella fastidiosa bacterium swept through the southern region of Puglia, whose ancient olive groves produce 65% of national output, usually about 400,000 tons, the Times reports. Olive prices rose 31% in January, which has led to fears that producers will fill up their bottles with lower-quality olive oil from Tunisia.
But while Italy has suffered its worst harvest in decades, Spain can thank climate change for its bumper olive crop, the Olive Oil Times reports. While Italy’s production dropped by more than 50%, Greece’s by 35% and Portugal’s by 20%, Spain’s olive oil production this season is expected to increase by 25% to nearly 1.8 million tons.
“Unseasonable cold snaps and heat waves lined up perfectly to produce a bumper crop of olives in many regions this year,” OOT wrote.
Worldwide, 20.8 million tons of olives were produced in 2017, according to the most recent statistics from the U.N. Food and Agriculture Organization. The top five countries account for more than 70% of the world’s olives:Spain: 6.6 million tons Greece: 2.7 million tons Italy: 2.6 million tons Turkey: 2.1 million tons Morocco: 1 million tons
International Olive Council data shows 3.1 million tons of olive oil were produced worldwide in the 2018/2019 season. (These numbers vary slightly from the EU Commission numbers quoted in the Olive Oil Times above.) The top five producers of olive oil are:Spain: 1.6 million tons Italy: 265,000 tons Greece: 225,000 tons Morocco: 200,000 tons Turkey: 183,000 tons
Olive oil harvests have had problems over the past few years. Bad weather in Spain and Italy led to shortages and price increases in 2017. In California in 2018, an early thaw followed by a cold snap cut olive production by 25% to 50%. The California Olive Oil Council estimated local producers would end up with 2.8 million gallons of extra virgin olive oil in 2018, a 30% decrease from the previous year.
Though it is worth noting that olive trees are alternate bearing crops that return a bigger than average harvest one year and a smaller than average harvest the next, experts think February thaws followed by March freezes may become the new normal in California.