Forecasts of the Olive Oil Campaign 2018/19: How is it developing in the main producing countries?

Forecasts of the Olive Oil Campaign 2018/19: How is it developing in the main producing countries?

2018/09/10 - After knowing the estimates of the International Olive Council (IOC), from Mercacei we gather in this article the first forecasts about the 2018/19 olive oil campaign in the main producing countries from consultants and international experts in the olive oil sector.

The writer, journalist, oleologist and director of Olio Officina, Luigi Caricato, explains that Italy faces a "very anomalous" production of olive oil and that there has been a gradual reduction against the initial forecasts. Thus, initially, a production of around 300,000 tons was estimated, although the unfavorable climatic conditions will reduce the harvest by 30 or 50%. In particular, the main decrease in production will be recorded in Puglia, a region that covers 40% to 60% of Italy's total production.

According to Luigi Caricato, the season will last approximately one month and the campaign has already begun with the objective of avoiding greater losses due to the natural fall of the olive tree. In addition, there are oil mills that will not even open in some areas, so oil prices are currently very high, standing at 5.50 euros/kg. "Of course, it is not a golden age for the Italian olive grove. For the last ten years, and in order to face the great problem of the lack of Italian oil, several companies are taking measures to establish new olive groves."

Regarding the first forecasts of the campaign in Greece, the broker specialized in the olive oil market Luigino Mazzei has specified that forecasts point to a production of between 220,000 and 230,000 tons.

According to Mazzei, in the Peloponnese region the olive grove is actually affected by dacus attacks and, in some areas, also by "leprosy", expecting a production of 100,000 tons. In the case of Crete, 75,000 tons are expected; in Zante, Corfù, Mytilini and Rodi 40,000 tons; and in continental Greece and Calcidica 15,000 tons.

Traditionally, the start of the campaign occurs at the end of October and the beginning of November, but this year, due to the dacus, it is likely to go ahead a couple of weeks.

In Spain, according to the strategic consultant, international olive oil analyst and professor at the University of Jaén (UJA) Juan Vilar, we expect a production of 1.63 million tons, which means an increase by 30% with regard to the previous season "as long as it is accompanied by edaphological, climatological and geographical circumstances, and with the caution to which these calculations are subjected". By Autonomous Communities, Andalusia would produce approximately 78% of the total and Castilla-La Mancha 8%, while Extremadura would contribute approximately with a 3% and the rest of Communities would contribute with the other 11%. Juan Vilar has indicated that the yields will be somewhat lower than the previous season and there will be a delay that could range between 10 and 15 days.

Regarding prices, in his opinion, they should remain "solid and stable", being able to experience upswings at the beginning of the campaign, gradually ceasing later, until reaching levels similar to the current ones. "Although the Spanish campaign is relatively high, in no case is it close to the maximum levels of productive capacity; while the rest of the producing countries with influence in the formation of prices still don't have enough capacity to supply their own annual full needs".

In Portugal -reports Alberto Serralha, CEO of Sociedade Agrícola Ouro Vegetal, S.A. (SAOV), producer and international consultant of olive oil-, after a record production in a very difficult year due to the drought, the olive tree was able to recover thanks to the abundant rains registered between February and June. Alberto Serralha pointed out that the olive grove in Portugal presents an "incredible" sprouting that allows us to guess a "huge" harvest for next year. In addition, the temperatures and the dry climate registered since September have contributed to control the populations of the olive fly, so "we can anticipate a good quality".

This expert has highlighted that more and more the Portuguese production is concentrated in the Lower Alentejo, a region that dominates the volumes produced and where an expansion of the crop continues to be observed, although "there is no updated data on new planted areas and this makes the elaboration of production estimates difficult, "although the overall feeling is that there will be a good harvest but far from last year". Tras os Montes also expects a good harvest, while Ribatejo and Alto Alentejo estimate a drop by 30% in their production.

Serralha believes that this year the Portuguese production will be at historical production levels, reaching between 90,000 and 110,000 tons.

The commercial agent and Italian broker Adriano Caramia has stressed that in the case of Tunisia there will be a significant drop in production compared to the previous campaign that was "exceptional". In this sense, the climatic conditions (especially the lack of rain) have been decisive in the forecasts, which foresee a production of around 120,000-140,000 tons.

For Adriano Caramia, the market conditions during the current year and the high stocks should compensate in part the reduced production capacity of the country for this campaign. The operators speak of at least 80,000 tons of stocks.

In particular, a low production is expected in the center of the country, although the harvest will be good in the south and especially in the north, in which they expect an "excellent" quality.

Traditionally, the Tunisian olive oil campaign begins in the first half of November, although it will be generalized throughout the country at the beginning of December.

As for Morocco, Noureddine Ouazzani, director of Agro-pôle Olivier, believes that the campaign forecasts are positive thanks to a not too hot summer, mainly due to the September rains and the August storms.

The current estimates place the production between 120,000 and 140,000 tons of olive oil. The current price of olive oil (production 2018) is approximately 3.6 euros/kg.

It should be noted that thanks to the Green Morocco Plan, the area destined for this crop has been increased, the sector has been modernized and both the quality of the product and its positioning for export have improved, especially targeting the US market.

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