In Spain, the olive oil sector is grappling with growing concerns as recent reports highlight a significant decrease in stocks, increasing worries about product availability in the months ahead. Although the stock figures for May show a less severe decline compared to the same period last year, they still indicate a monthly decrease of approximately 83,000 metric tonnes. Presently, the industry estimates that the available olive oil stock is less than 265,000 metric tonnes, serving as a stark reminder of the challenges the sector will face until the new olive harvest towards the end of the year, from October onwards.
Despite some rainfall in Spain over the past month, particularly in Andalusia, where water stress was particularly prominent, the impact on the water deficit has been moderate at best. Industry sources, expressing concerns to Mintec, indicate a lack of optimism regarding the productivity of the upcoming harvest, suggesting that the damage has already been inflicted. Consequently, market players foresee a bleak outlook for the upcoming harvest season in Spain and Greece, with some even suggesting that Spain's recent production of an estimated 620,000 metric tonnes could be replicated, further exacerbating the industry's worries.
The olive oil market has entered a phase of extreme volatility, with prices skyrocketing due to the scarcity of offers and the continuously evolving situation, rendering previously quoted prices obsolete within a matter of hours, and leaving the market struggling to find stability amid the oscillating forces of supply and demand. In Spain, the situation is particularly tense as the high prices fail to dissuade consumers from purchasing olive oil. In fact, industry players are reportedly scrambling to secure supplies, driven by the looming risk of running out of stock in the coming months. The sense of urgency has sparked a surge in buying activity, further fueling the market's instability.
With the summer approaching, the prospect of meeting the growing demand for olive oil is becoming increasingly challenging. The sector is bracing itself for the obstacles ahead, fully aware that without a significant increase in production, consumers may soon face the daunting reality of olive oil scarcity, according to market players.