In the 2023/2024 crop year, the European Union estimated a yield of 1.5 million tons of olive oil, 9% above the historic low of the previous season (1.384 million tons)—an estimation suggesting that the supply shortage of olive oil will be overcome in the following year. During 2023, many of the major olive-oil producing nations in the European Union followed challenging harvests, including: Spain, Italy, Greece, and others.
Olive oil production in Greece has a long history, dating back thousands of years. It is a central part of the Greek and Mediterranean diet, accounting for 9% of total agricultural production value in Greece and contributing 0.4% to the nation's GDP.
Although the predictions for the European Union's olive oil production look optimistic, Greece's expected olive oil yield is set to drop by a staggering 20% in the 2023/2024 crop year. Specifically, in the Halkidiki region of Greece, the crop shortage in 2023 exceeded 90% due to the lack of flowering of the olive trees.
Climate change has led to late winters and warmer temperatures, therefore delaying and even reducing total crop yields in the country. Furthermore, a recent study also predicted a further increase in the average temperature in the local temperature, and less rain, something bound to affect the quality and yield of fruit. In mid-November, temperatures in Polygyros, Halkidiki were still over 15 degrees Celsius. The loss of revenue and the overall economic impact on farmers has been significant, an estimated loss of 200 million from just the Halkidiki region alone.
This change is not only affecting growers, but also producers. In the last year, olive oil processing and production also saw a decrease at least 60%. Additionally, the incidents of olive oil shelf from olive groves and warehouses saw an increase in reports, adding to the challenges faced by all stages of production.
This can be attributed to the increase in price due to the supply shock, the price of olive oil in Greek supermarkets having rose by an average of 29% in 2023 compared to the previous year, extra virgin olive oil retailing at an average of around 15 euros per kilogram. Additionally, producer prices saw an extreme price increase, mainly happening in the summer, where there was a price soar from around 3.5 euros per kilo to around 8-8.5 euros per kilo.
Despite this, Greek olive oil exports were still on the rise. As seen in the figure above, Greece had a rise from 2021-22 to 2022-23, however, the predicted numbers for the 2023/2024 do not look to be optimistic. Although Greece finally managed to surpass Italy in olive oil production, it is set to lose this lead within the next crop year.
The European Union produces around 67% of the olive oil in the world, Greece being the country with the highest per capita consumption with the European Union. An issue with this investigation into olive oil prices is the fact that there are many Greek people consuming unregulated olive oil, many people still buying olive oil from friends and family with their own olive farms.