Greek olive oil surplus ‘sinks’ into barrels – lessons from UK, US – The Economic Post

Greek olive oil, which is perhaps the most emblematic product of our country and has a significant weight in commodity transactions, has not yet found its way to international markets as a branded product despite the honorable efforts of hundreds of producers of the product. It continues to be sold in bulk, mixed with oil of other origin and bottled in major oil producers and experienced exporting countries such as Italy.

Olive Oil: Is Olive Oil Becoming a Luxury Good? – The Problem is in Production

A typical example is the UK market. Even as the cost of living has risen, Old Albion olive oil faces inelastic demand as the trend towards a healthier lifestyle affects the dietary choices of a large proportion of Britons, especially those on higher incomes, creating an opportunity to promote certified organic and extra virgin olive oil.

Belgian olive oil!

However, even under these conditions, Greek extra virgin olive oil has less penetration into the British market than in Belgium, which has no olive groves!

In particular, Greece is the fourth most important olive oil supplier to Britain, with Belgian olive oil being the most penetrated after Spain and Italy.

The same series appears for extra virgin olive oil, a category in which Greece has an advantage. In this case, Spain dominates (51.2% of the value in 2023), followed by Italy (28.7%), Belgium in third place (8.3%) and Greece in fourth place (6.9%), despite the fact that between 2023 and 2022 there was a very significant increase in our country’s export sales of 84.3%.

Exporting olive oil to Britain

In more detail, according to HMRC data for the first quarter of 2024, imports of Greek olive oil into the UK amounted to £6.8 million (€8 million), compared to £3.8 million (€4.49 million) in the same period last year, an increase of 76%, while imported quantities also increased by 10% to 774 tonnes, compared to 701 tonnes in the same period of 2023. Almost all exports of olive oil are extra virgin (£6.2 million – €7.3 million).

The trajectory of Greek exports to Britain is said to be so far maintaining the upward trend of last year, when the value of Greek exports doubled compared to 2022 from £9.4 to £16 million (from €11.1 million to €18.9 million), increasing its share both in terms of value (from 3.7% to 4.8%) and in total imported volumes (from 3.1% to 4%).

Overall, Greece exported £15.3 million worth of extra virgin olive oil in 2023, or 2.4 million tonnes, at an average value per kilogram of £6.4 (compared to £4.6 in 2022).

Greece performed better in this category than Italy and other major supplier countries, whose export volumes fell, while Greece and Spain reaped losses.

But the presence of Greek olive oil is not as engaging as it could be, given the appeal of the Mediterranean diet in Britain.

It is noteworthy that the total value of olive oil imported by Britain in 2023 was 333 million pounds (393.7 million euros) and a quantity of 62.4 million kilograms. Interestingly, although the situation was strongly inflationary, especially in olive oil, the price of which increased in the second half of 2023, while the peak annual rate of change was observed in November 2023 (+51% compared to November 2022). – Imported quantities of extra virgin olive oil decreased in 2023, by only -2.7%, indicating the inelasticity of demand for olive oil imports in the United Kingdom, compared to the price.

$100.7 million in Greek exports to the United States

The rise in prices due to the production deficit also affected the path of Greek olive oil exports to the United States, which is considered the “locomotive” of the global olive oil trade.

In more detail, Greece exported $100.7 million worth of olive oil in 2023 to the United States, covering 4.7% of the total imports of the US market.

This is a leap forward compared to 2022, when Greek olive oil exports were set at $58.5 million.

Over time, nearly 75% of U.S. olive oil imports come from three countries: Italy (32.8%), Spain (31.9%) and Tunisia (10.1%).

In 2023, Greece covered about 4.7% of olive oil imports (in 2022 3.3%) to occupy the fifth place with Turkey occupying the fourth place with an average share of about 9.7% (in 2022, 4.0%).

The trap

But even in this good situation, since exports mainly concern standard oil, the penetration of Greek extra virgin olive oil is not as it could be.

Looking ahead to 2022, a year in which Greece and Turkey reached record production of around 350,000 tons each, and while Spain cut its production, Spanish and Turkish virgin olive oil exports to the United States grew faster ($502 million and $167 million, respectively) than our country’s revenues of Greece ($152 million).