Why is olive oil so expensive? Understand and remember how much the product cost in 2023 | News

The prices of olive oil on the domestic market seem to have no limit to their increase. Between February 2023 and February 2024, average prices for a 250 ml bottle of extra virgin product rose 51.4%, while those for a 500 ml bottle increased 43%.

During this period, smaller packages of olive oil went from R$20.03 to R$30.33. The largest ones, from R$31.58 to R$45.17.

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The price of the virgin product, 250 ml, rose 25%, while the 500 ml package increased 48.3% in the same period. The information comes from a survey carried out by the consultancy Horus Market Intelligencebased on the analysis of 500 million invoices per month registered in supermarkets and hypermarkets across the country.

As a result, virgin, in a 500 ml package, which was sold on average for R$ 26.93 in February 2023, reached R$ 39.93 in February 2024. Preliminary survey by the consultancy shows that in the first 21 days March, the average prices for a 500 ml package of virgin olive oil were even higher, on average, R$43.37.

In the 250 ml version, the oils that previously cost R$ 22.49 now cost no less than R$ 28.14.

In Brazil, the Ministry of Agriculture, Livestock and Supply (MAPA) classifies as extra virgin olive oil the product that has a maximum acidity of 0.8%, and as virgin the product with an acidity between 0.8% and 2%.

Why is olive oil so expensive?

The historic drop in Europe’s olive harvest in 2022/23, due to the drought caused by El Niño, dropped global olive oil production by 20%. Instead of 3.3 million tons, 2.7 million tons of olive oil were produced, according to the International Olive Oil Council (IOC).

As a result, exports were impacted and Brazil, as one of the largest importers of the product, reduced its purchases from 100 thousand tons of olive oil in 2022, to 80 thousand tons, in 2023.

Retraction in purchases

With higher prices, consumers bought less olive oil. This is what the data on the incidence rate of olive oil on invoices shows. The rate indicates the presence of the product in every 100 invoices evaluated. In February 2023 it was 4.3%, falling to 2.4% in February this year, showing that out of every 100 invoices, only 2.4 included the olive oil category.

In addition to buying less, it is also common for consumers to opt for smaller bottles, 250 milliliters. “But the ideal is to calculate the price per liter of product”, he recommends. Anna Carolina Fercherdirector of insights of consultancy. This is because although the values ​​of smaller bottles seem better, they are not.

According to average prices practiced in February, a liter of the product sold in a 250 milliliter bottle cost R$ 121.32, while that sold in a 500 milliliter bottle cost R$ 90.34. The consultant also advises consumers to evaluate the prices of all brands.

Uptrend

The trend for the 2023/24 harvest is for prices to remain at high levels. This is because, although estimates point to a slight increase of 9% in European production, to 1.5 million tons of olive oil in the period, it will not be enough to meet demand.

Climate adversities, characterized by excessive rain in some producing regions and drought in others, compromised the performance of the orchards. Furthermore, the 2023/24 harvest is the year of low production of olive trees, which are a biannual crop. Such a scenario should bring down exports and consequently world consumption.