The price of a liter of olive oil will rise again, but it will not reach 10 euros.

The harvest forecast was good, very good, in spring, but in summer everything changed. High temperatures from June to September and the lack of rainfall have caused olives to rot in the olive groves, both in Catalonia and Andalusia. That's why oil prices could rise again this season, because there will be a gap between supply, which will be limited, and demand, which is high. However, It could be that a liter of olive oil will not reach 10 euros, as happened in the 2023-2024 campaign., and the final price for the consumer remains at 6 euros. One of the reasons is that the oil mills have stocks of produced oil, from the previous campaign, 2024-2025, which was a year of a splendid harvestSpecifically, the starting oil stock is 280,000 tons, which is an additional 100,000 tons compared to last year's campaign. In any case, the retail price of olive oil throughout Spain will be set, as always, by Andalusia, which produces 60% of the country's olive oil, while Catalonia accounts for only 5%.

With fifteen days left until the harvest begins in Catalonia, Agustí Romero, a researcher specializing in olive trees and elaiotechnology at the Institute of Agrifood Research and Technology (IRTA), states that This campaign's harvest may be somewhat higher compared to last year, but still far from a good year. In figures, while last year's total production of virgin olive oil was 14,436 tons, this year's forecast is 15,000. "That is, nothing compared to what would be a normal year, like the ones we had before the drought, when the figure was around 50,000 tons," Romero continues.

Lost harvest

In Andalusia, the forecast is pessimistic. "This year there were olives, and plenty of them, and they were good quality, because it rained in the spring, but they dried up in the summer," says the director of the Jaén olive mill. Guadalimar Leisure, Paco González, which last season produced six million kilos of olive oil, equivalent to 28.7 million kilos of olives. A dry olive means that it hasn't undergone lipogenesis; that is, high temperatures and lack of rain have prevented the olives from producing oil, so production will be lower than producers had expected in the spring.

This week, the price at source has already begun to rise, reaching €4.50 (one euro more than at the end of last year). The oil currently being sold is from last year's harvest, so when the new campaign begins, the market will be governed by new prices, always set by Andalusia, which also manages the oil stocks. It's difficult to predict the exact price per liter of olive oil before the harvest has even begun, but everything indicates that the price at source will be around €5, and therefore, the final price must be added to the €6 distribution cost.

In the fall of 2023, when a liter sold for €10, the reason was the loss of olives due to the drought and also because there were no stocks. Therefore, there was high demand for olive oil, but very little supply for sale. This is what could be different in this new campaign, which begins on October 1st, when there will be few olives to produce new olive oil, but the oil mills will have stock from the previous campaign.

It's a different story when shopping at the supermarket, where prices fluctuate so much that it's difficult to distinguish whether we're in a year with a good or bad olive harvest. If for much of this year a liter has been sold at source for €3.50, on supermarket shelves the price has been between €6 and €8. And perhaps even €10. If this were the case, it could be because the olive oil still came from the 2023 harvest, the first year this figure was reached, but it could also be for many other reasons, such as the profit margin each brand wants to achieve between production or purchase at source (a company doesn't necessarily have to produce oil to put it on sale) and the final sale of the product.

Finally, the olive oil currently sold on supermarket shelves should be priced at around €5 or €6, because for much of the year, it has been sold at half the price at source (around €3). However, in practice, some brands have decided to continue with high prices, those for the 2023-2024 harvest, perhaps because they were still selling olive oil from that season. In any case, a liter of olive oil is one of the most expensive in recent years, up 52% compared to 2020, according to the Council of Food Distribution Companies of Catalonia on TV3.

Where does the oil we buy come from?

Brands are not required by law to indicate the name of the town, the area, or the exact region where the oil is produced on bottle labels, only if it was produced in Spain, the European Union, or outside of these two countries. As he explained to this newspaper, there is a legal loophole that allows us to buy oil from Jaén thinking it's Catalan, becauseLabeling regulations do not require the city of origin of either the olives or the oil production. So much so that the address we read on the back labels corresponds to the company name of the company that markets it, which may have packaged the same oil purchased outside of Catalonia there. And this is where the misconception arises, because the consumer, if they see the company name of a Catalan company, may think the oil was produced in Catalonia, when in reality it could come from anywhere else in the country. This approach, which could be interpreted as cheating, is entirely legal and permitted by industry regulations.