With the conclusion of the olive-harvest and oil production, the results may cause concern both by sellers and consumers, as it was 6-percent down on last year.
Couple this with the fact that the costs of electricity, fertilisers, and agricultural diesel have risen, yet prices continue to drop, which although might bring a smile to the faces of consumers, has producers looking glum.
According to the latest data , from May the 18th to the 24th, the origin price for extra virgin olive oil was 4.04 euros/kilo, virgin olive oil was 3.241, and lampante oil was 3.11. The latter is not used for direct human consumption unless highly refined and mixed with better grade olive oil.
Comparing these figure with the end of April and the first week of May, it shows a drop in price: virgen extra olive oil was 4.34 euros/kilo, virgin was 3.59, and lampante was 3.21.
With the 4-euro barrier looming, there are more dealers selling than buying, making farmers are highly concerned. Because of this packers manipulate the olive oil market, according to the Head of Olivar at Coordinadora de Organizaciones de Agricultores y Ganaderos, Andalucía.
“When they see that the year looks promising for farmers, even if there are still many months left before taking the olives to the mill, they hoard kilos to build stock and later exert downward pressure,” he insists.
Farmers are getting nervous because they see a good harvest ahead while prices are falling and to the cooperative. “Since the second half of April, there have been practically no olive oil purchases, at least no significant ones,” claims GOAG.
COAG believes that the industry also intends to use this move to condition the prices of the upcoming olive oil campaign even before it begins: “Operators know exactly what they are doing. With the arrival of summer, exports drop, making it an ideal moment for packers to speculate,” he points out.
What this means for farmers is that with the current prices they are offered, many olive farmers can’t cover production costs; their costs are rising but the price at origin is dropping due to speculation.
(News: Andalucia)
Keywords: The Olive Oil Market, Price at Origin, Speculation, Hoarding, Lower Harvest
news, andalucia, the olive oil market, price at origin, speculation, hoarding, lower harvest