The European Commission (EC) expects olive oil production and exports to increase over the course of the next decade.

By 2030, the EU olive oil sector is expected to grow in productive capacity. Thus, production will increase by 1.1% per year on average, reaching 2.4 million tons in 2030 (compared to 2 million tons in 2019). Also, domestic consumption could grow in non-producing countries, while that strong demand in traditional and new markets will favor an increase in exports.

In recent years, higher than average olive oil prices and lower profitability of alternative crops has led to an expansion of the areas of olives for oil (mainly irrigated, intensive or super intensive) in the Iberian Peninsula. By contrast, the expansion was rather limited in Italy and Greece. Environmental concerns about water use and the impact of monoculture in certain areas, and recent competition with more profitable crops (e.g. almonds), are expected to slow down this expansion over the outlook period (to +0.2% per year on average).

Nevertheless, productivity is expected to be the main driver of production growth. This is mainly due to increasing yields, resulting from new plantations, irrigation systems and continuously improving agronomic conditions of trees. The speed of change may also be influenced by consumers’ increasing preference for early-harvest olive oil (of lower yields) and specialised mono-varietal oils, for their organoleptic qualities.

By 2030, the EU’s olive oil production is expected to grow by around 400 000 t (+1.1% per year on average). It is expected to grow at the fastest rate in Portugal (+88% compared to the trimmed average for 2014-2018). Growth is also expected in other Member States (+30%), mainly thanks to value creation strategies (e.g. organic production).

Farm succession will remain a challenge, particularly in Italy and Greece, where most farms are smaller than 5 ha, and where around 70% of the owners of these small farms are 55 years and older.

Growth in demand outside main producing countries
Factors that could influence future olive oil consumption include the increasing popularity of eating out and of convenience food, and younger generations’ concerns about their health and the environment. In the EU’s main producing countries, the declining trend is expected to slow down by 2030 (falling to -0.8% per year on average compared to 3% in 2004-2018). In other Member States the increasing trend is expected to accelerate (+3.3% compared to +2.3%), mainly thanks to awareness campaigns and the incorporation of olive oil into modern lifestyles (e.g. foodservices). By 2030, the share of these Member States in the total EU consumption is expected to grow by 8 pp (to 32%).

The growth potential of EU exports is high (+3.3% per year on average) due to the lower per capita consumption in many parts of the world. Targeted promotion campaigns are expected to play a role in increasing trade to traditional and new export markets.

Source: Mercacei

Read and download the European Union agricultural outlook for 2019-2030 report published by the European Commission here.