ECONOMY

World olive oil output seen at three mln tons in 2007 as appetite grows

MADRID (Reuters) – World production of olive oil is likely to rise to around 3 million tons in crop year 2007-08, the Madrid-based International Olive Oil Council (IOOC) said yesterday. Its 2006-07 forecast is unchanged at 2.82 million tons of olive oil and 1.83 million tons of table olives. «Given the forecasts we have for some countries, we think the next crop year will be a good one, IOOC’s Executive Director Habib Essid told a news conference. Spain is by far the largest olive oil producer, followed by Italy and Greece. In the last crop year, which ended on September 30, 2006, world output was 2.60 million tons, undermined by drought in several countries. «This (current) crop year is a normal one with production in line with the last four years,» Essid said. «We think prices will be around 2.50 euros a kilogram… with a maximum of 3 euros,» he added, referring to producer prices. The reference price in the Spanish olive oil futures market was 2.48 euros a kilo yesterday. World olive oil production and consumption have been closely matched in recent years, but IOOC is concerned that supply is now growing faster than demand as new areas are planted with olive trees and more intensive farming methods take hold. Countries where production is growing fastest include Turkey, Syria, Iran, Morocco, Algeria, Argentina and Spain, IOOC said. It has actively promoted olive oil in the US in recent years and plans to keep plugging away at European Union consumers to increase their purchases. Other countries were unlikely to catch up with Greeks, who consume almost 25 kilos a year of olive oil per head. «But a goal of 10 kg a person in the EU would be a reasonable one,» Essid said. The EU now accounts for 77 percent of world olive oil production and 72 percent of consumption. The US accounts for 8 percent of consumption and the rest is highly fragmented.