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Spain's olive harvest is under danger due to the drought.

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Dunya News

(AFP) Madrid – Spain, the top producer of olive oil in the world, which had a very challenging year in 2022, is now fearful of an olive “catastrophe” due to a continuous drought and high temperatures.

Since January, hardly any rain has fallen. The center of Spain’s olive oil industry, Andalusia, in the south, is home to Cristobal Cano, secretary general of the small farmers’ union (UPA), who is concerned about the state of the ground.

In his 20 years as a farmer, Cano, who owns 10 hectares of olive trees in Alcala la Real, close to Granada, has never seen such a concerning circumstance.

It’s going to be a catastrophe, he said, if nothing drastically changes in the next weeks.

The AEMET meteorological office reports that total rainfall since October 1 has been 25% below average throughout in Spain and 50% below average in most of Andalusia, where reservoirs are at 25% capacity.

When an early heatwave produced unusually high temperatures that saw the mercury reach 38.8 degrees Celsius (101.8 degrees Fahrenheit) in southern Spain at the end of April, the situation only got worse.

Rafael Pico, director of Asoliva, the Spanish organization of olive oil producers and exporters, claims that this occurred while the olive trees were in bloom and expresses concern that the blossoms may soon dry up.

“There is no fruit if there are no flowers. There won’t be any oil if there is no fruit.

“On the verge of collapsing”

The scenario is even more concerning for Spain, which typically supplies 50% of the world’s olive oil and exports close to 3.0 billion euros ($3.3 billion) year, considering the sector’s dismal production in 2021–2022.

According to data from the agricultural ministry, during that season as well, olive oil output fell by 55% to 660,000 tonnes from 1.48 million tonnes in 2021–2022, due to a lack of rain and extremely high temperatures.

This year, the situation is expected to repeat itself.

The biggest olive cooperative in Spain, Dcoop, is led by Rafael Sanchez de Puerta. “Looking at the forecasts, it’s almost a given — it’s going to be another grim year,” says Sanchez de Puerta.

Numerous olive farms may not survive if the forecasts come true.

“We can survive a challenging year. It’s an organic phase in the growth process. But doing it twice in a row will be disastrous. Many are about to collapse, he claims.

In light of the fact that many people in Spain make their living from the production of olive oil, Asoliva’s Pico asserts that “farmers need liquidity” to survive the expense of machinery, paying wages, and repaying loans.

Excessive prices

Consumers too face a gloomy future.

Spain is a major factor in the price of olive oil worldwide, claims Pico.

The price of oil has increased recently.

“In mid-April, olive oil was selling at 5,800 euros ($6,400) per tonne, up from 5,300 euros in January,” reports Fanny de Gasquet of Baillon Intercor, a brokerage company that specializes in oils and fats.

Its price in January 2022 was 3,500 euros.

And it appears that the increasing trend will continue.

She cautions that immature olive trees in Andalusia “don’t have sufficiently developed roots to be able to extract water” from deep down, which means “there will be losses” that will have an effect on production over the following two or three years.

In an effort to assist consumers in the face of growing inflation, the Spanish government reduced the VAT on olive oil from 10% to 5% by the end of 2022.

Additionally, the government has decreased the income tax on farmers by 25% in order to assist them in coping with the drought.

However, many feel that in light of the impending crisis, it is insufficient.

In order to tackle “a drought that is lasting longer than it should,” argues Dcoop’s Sanchez de Puerta, “lowering taxes for people who will have almost no income is of little use to them.”

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