Olive oil to cost more as production worldwide slumps

The cost of olive oil in Portugal is set to rise as throughout the world harvests have been registering “significant falls”.

Bearer of the bad news was Mariana Matos, secretary-general of Casa do Azeite, Portugal’s association of olive oil producing companies.

Speaking at the third Iberian olive oil congress in Abrantes over the weekend, Matos said the fall in production was due to “bad climatic conditions” last year that coincided with “crucial moments” in the growth cycle of olives.

“With such accentuated falls in worldwide production, it is natural that the price will have a significant increase,” she said. “It is the law of supply and demand.”

Right now, she explained, prices in the shops do not reflect the sector’s crisis.

“The price of olive oil at origin (i.e. the price of olives) has increased by around 60%,” she explained. Meantime, production has slumped by as much as 20-25%.

Prices are thus expected to start rising “progressively, until they reflect the higher cost of the raw material”.

There is good news, however. The drop in the value of the euro should be “positive” for exports – and this could reduce the increases that would otherwise have to be met by the domestic market, she said.

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