Understand the rise in olive oil prices

The prices of olive oil on the national market continue to rise without showing signs of slowing down. Between February 2023 and the same month in 2024, the average value of 250 ml bottles of extra virgin olive oil increased by an impressive 51.4%, while those of 500 ml increased by 43%. During this period, small containers of olive oil saw their prices jump from R$20.03 to R$30.33, while larger ones jumped from R$31.58 to R$45.17.

250 ml virgin olive oils saw a 25% increase in their prices, while 500 ml ones saw an even greater increase of 48.3%. These findings derive from a study conducted by the consultancy Horus Intelligence de Mercado, which meticulously analyzed 500 million invoices issued per month in commercial establishments across the country.

As a result, 500 ml virgin olive oil, which cost an average of R$26.93 in February 2023, reached the mark of R$39.93 in February 2024. A preliminary analysis by the consultancy suggests that in the first 21 days of March, the average prices for 500 ml virgin olive oil rose even further, reaching an average of R$43.37.

In the case of 250 ml containers, the oils, which were previously sold for R$22.49, are now not available for less than R$28.14.

The Ministry of Agriculture, Livestock and Supply (MAPA) classifies extra virgin olive oil as one that has a maximum acidity of 0.8%, while virgin olive oil is defined as one with acidity between 0.8% and 2%.

Why are olive oil prices sky high?

A historic drop in the olive harvest in Europe during the 2022/23 period, as a result of the drought caused by the El Niño phenomenon, reduced global olive oil production by 20%. Instead of the usual 3.3 million tonnes, only 2.7 million tonnes were produced, as reported by the International Olive Council (CIA).

As a result, exports were affected and Brazil, one of the main importers of this product, reduced its purchases from 100 thousand tons in 2022 to 80 thousand tons in 2023.

Fewer purchases, higher prices

With prices rising, consumers are purchasing less olive oil, as evidenced by data on the incidence of the product on invoices. The incidence rate indicates the frequency with which the product is found in every 100 invoices analyzed. In February 2023, this rate was 4.3%, falling to 2.4% in February this year, which means that only 2.4 out of every 100 invoices contained the olive oil category.

In addition to buying less, it is common for consumers to opt for smaller bottles, measuring 250 milliliters. However, “it is essential to calculate the price per liter of the product”, suggests Anna Carolina Fercher, director of insights at the consultancy. This is because, although the prices of smaller bottles seem more attractive, they are not always so.

According to the average prices practiced in February, a liter of product sold in 250 milliliter bottles cost R$121.32, while the same volume sold in 500 milliliter bottles cost R$90.34. The consultant also advises consumers to compare the prices of all available brands.

Rising price trend

For the 2023/24 harvest, everything indicates that olive oil prices will remain at high levels. This is due to the fact that, although forecasts point to a small increase of 9% in production in Europe, totaling 1.5 million tons of olive oil in the period, this quantity will not be enough to meet demand.

Adverse weather conditions, such as excessive rainfall in some producing regions and drought in others, harmed orchard yields. Furthermore, the 2023/24 harvest corresponds to the year of low production for olive trees, which follow a biannual cycle. This context will likely result in a drop in exports and, consequently, in global consumption of the product.

Written by Buy Rural

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