Carapelli: the price of extra virgin olive oil will remain above EUR 5

For extra virgin olive oil, 2024-2025 will be a campaign with a plus sign. Spain, the world's leading producer, after the collapse of the last two years, is preparing to return more or less to its usual production levels, and more generally, Mediterranean production is expected to grow by 30%. All the ingredients would therefore be there to finally expect a lowering of prices, after the record of 9.5 euros per kilo reached this year. Instead, this will not be the case.

Bruno Seabra, general manager of Carapelli, the historic brand of extra virgin olive oil made in Italy that is now part of the Spanish group Deoleo, is convinced of this. Or rather: the price of oil will decrease a little, but it will certainly not see a 40% drop, as Zefferino Monini, another Italian oil bigwig, recently went so far as to declare. 'Certainly prices will relax, to the benefit of consumers,' says Seabra, 'but oil will no longer return to the prices of 2020-2021, when bottles of extra virgin were on the shelf for less than EUR 5 or even, in promotions, for EUR 3.99.' The reason? 'It is impossible for farmers to earn with prices that are too low,' Seabra explains. 'Let's say that below EUR 3.5 per kilo cannot be considered an adequate remuneration for olive growers. We should not look back with regret to previous periods: for years consumer prices were too low and did not allow a fair remuneration for the various actors in the chain. In addition, extra virgin olive oil was used by large retailers as a coquette product, hostage to price policies that had little or nothing to do with its value'.

And yet, already at the end of the summer holidays, oil prices on supermarket shelves were already registering the first drops: 'It is true,' Seabra confirms, 'and below-cost offers also appeared, in some cases even below 7 euro per bottle. But this is too fast a drop for the current market reality, the result of strong pressure from the large-scale retail trade that wants to recover sales levels'. The collapse in purchases of extra virgin olive oil by Italian consumers, frightened by excessively high prices, has undoubtedly taken place: 'In the last two years, olive oil consumption in Italy has fallen by 16 per cent,' admits Seabra. 'This is a significant drop: Italian families continue to buy olive oil, but have at times replaced it with other oils that are more affordable. Have Italians therefore become accustomed to using less oil? 'I believe that this change will partly consolidate,' says the Carapelli CEO, 'which is why as a group we are looking with increasing interest at the foreign market, which is more profitable and has wide margins for growth, given that the penetration of olive oil in many markets is still low. For companies, export will be a key card for growth: the United States, Germany and France are important destinations for our future development'.

In order to revive domestic consumption, on the other hand, promotions are not entirely to be demonised: 'I believe that they are necessary to revive consumption,' Seabra argues, 'and we must also be honest in saying that, at times, it is we producers ourselves who want to do them, not just the large-scale retail trade. I believe, however, that below a certain price threshold even promotions can no longer go down. The concern of farmers is the same in Italy as in Spain: they have to deal with reduced production and costs that have increased. We all have to work so that olive growers cover their costs'.