Olive oil prices have hit new records as severe droughts in major producing countries reduce supplies and increase cooking oil thefts.
Global olive oil prices soared to $8,900 per ton in September, driven by “extremely dry weather” in the Mediterranean, according to a recent report from the United States Department of Agriculture. Already, the average price in August was 130% higher than the previous year and showed “no signs of slowing down,” the USDA said.
Spain, the world’s leading producer and exporter of olive oil, has been hit by an intense drought for months. The country also just recorded its third hottest summer, with the average summer temperature 1.3°C higher than normal, according to national weather agency AEMET.
According to data from raw materials market information company Mintec, Spanish olive oil production last season fell to around 610,000 tonnes, a drop of more than 50% from to the usual 1.3 to 1.5 million tonnes.
“Concerns about reduced production in other major European olive oil-producing countries, including Italy and Greece, where drought conditions prevail, add to the complexity of the situation,” said Kyle Holland, Mintec oilseeds and vegetable oils analyst, at CNBC.
Greece and Italy are the second and third largest producers of olive oil, according to the International Olive Council, an intergovernmental organization made up of members who represent more than 98 percent of global olive production.
Olive oil thieves
Olive oil prices in Spain’s Andalusia rose to €8.45 ($9.02) per kilogram in September, benchmark Mintec showed. This is the “highest price ever recorded for Spanish olive oil” based on company data spanning 20 to 30 years and represents a 111% year-on-year jump. the other.
The soaring price of what is sometimes called “liquid gold” has led some to steal it.
Around 50,000 liters of extra virgin olive oil were stolen from one of Spain’s oil mills, Marin Serrano El Lagar, in the early hours of August 30, according to local media. That’s more than €420,000, or about $450,000 worth of olive oil, that the family business lost. There have been no arrests so far.
That’s not all.
Shortly before, thieves stole 6,000 liters of extra virgin olive oil worth 50,000 euros from the Terraverne oil mill, Spanish newspaper El Munco reported. The company’s computers, tables, fans and chairs were also reportedly looted during the robbery.
The companies in question did not respond to CNBC’s request for comment.
When will this end?
And there is no respite in sight.
Mintec’s Holland warned that if olive oil stocks continue to run out due to drought, supplies could be exhausted before October, when new harvests usually arrive.
“Turkey’s decision to suspend bulk olive oil exports further complicates matters,” the analyst said. “The suspension has worsened the already limited volumes in Spain.”
Turkey, which is also a major producer of olive oil, suspended bulk exports until November 1, a decision resulting from the global price surge.