The price of olive oil rises dramatically: counterfeiting and stock shortages are breaking records

By: Trademagazin Date: 2024. 08. 27. 12:01

The world market price of olive oil has more than doubled in the past two years, thanks to production difficulties caused by extreme weather. However, in addition to the rising prices, another serious problem also reared its head: never before have so many people tried to counterfeit olive oil as recently. In the European Union, at the beginning of this year, cases related to fraud set a record, which further aggravates the situation.

Effects of weather and inventory shortages

Global olive oil production has declined dramatically in recent years. While 3.3 million tons of olive oil were produced worldwide after the 2021-2022 harvest, a year later this amount had dropped to just 2.4 million tons, and according to preliminary estimates, the most recent harvest produced even less, 2.3 brought million tons. The European Union, which is the leading player in the world olive oil market, is particularly affected: the result of the 2022-2023 harvest of only 1.4 million tons represents a decline of an unprecedented scale and is considered the third worst figure in the last ten years.

Extreme weather such as heat waves, lack of rainfall, and frequent forest fires and bird damage all contribute to production difficulties. These factors especially affect smaller producers, for whom it is often not worth picking the crop due to the small amount. Consumers are also feeling the consequences of the lack of stock, as the price of olive oil has increased to an extreme extent due to inflation.

Price explosion and counterfeiting

World market prices skyrocketed already at the end of summer 2022: the price per ton rose from $4,000 to $9,000 and exceeded $9,100 in June 2024. The difference in the price of the products is huge, since while the large-scale, low-quality oils are cheaper, the high-quality production versions are significantly more expensive, since their production requires significantly more raw materials and more careful processing.

The increase in demand for olive oil and the drastic increase in prices also led to a jump in the number of counterfeiting attempts. While the EU registered only fifteen cases of fraud in the first quarter of 2018, in the first three months of this year, member states already reported fifty to the EU’s Directorate General for Health. This increase clearly indicates the seriousness of the problem and points to the need for increased control of the market.