Olive oil consumption is increasing throughout the world. Heart conscious consumers are becoming aware of the protective effects of olive oil on the heart. Cooks throughout the world are becoming aware of the delicious foods they can prepare using olive oil. The sum total of this is that are much higher proportion of olive oil is consumed outside of the Mediterranean Basin and the Middle East. This is good news for those who like good olive oil and for anyone interested in investing in the expansion of olive oil consumption worldwide.
World Olive Oil Consumption
The International Olive Oil Council figures on olive oil consumption show a worldwide increase from 1,666.5 tones in 1990 to 2,839 tons in 2009. Consumption went up in the olive’s traditional base in the Mediterranean and Middle East from 1,427.5 tons in 1990 to 2.242.5 tons in 2009. However, it is the increase in consumption of olive oil outside of where it is traditionally part of the diet that is the most spectacular. From 1990 to 2009 consumption of olive oil in the world outside of the Mediterranean and Middle East more than from 239 tons to 596.9 tons.
A report published by the United States Department of Agriculture Foreign Agricultural Service (GAIN Report IT1028) notes that “Ten years ago, Italy, Spain, and Greece produced 80 percent and consumed 90 percent of olive oil globally. Today, those leading Mediterranean countries consume about 60 percent of total olive oil, with consumption increasing the most in the United States, Japan, South America, and Eastern Europe.”
The report also states that, “The EU accounts for about 80 percent of global olive oil production, North Africa accounts for 15 percent, and the others produce the remaining 5 percent.”
Olive oil producers world wide are organizing and preparing for a continuing increase in olive oil consumption. For example, the privately owned international food products giant, Cargill, and a Spanish partner have just inaugurated a new 18 million Euro bottling plant in Spain. According to Cargill’s press release the plant will have the capacity to bottle more than a million liters of olive oil each year. The plant is also built so that capacity may be increased in future years!
The presence of Cargill in this operation is telling as Cargill is an international operation with vast production and risk management expertise as well as a gigantic global trade, export, and distribution system.
Two Examples: the UK and India
We present two examples of countries where olive oil is not a traditional food and where consumption is gaining ground.
The United Kingdom: Olive Oil in the Land of Fish and Chips
As worldwide consumption has increased by 70% from 1990 to 2009 the UK share of the total has increased from 1.9% to 2.9% (more than 60,000 tons). In just the last ten years olive oil use has increased from 35% of British homes to 50%.
The UK share of the world consumption of olive oil has risen from 1.9% to 2.9% between 1990 and 2009. The UK now consumes 28 million liters of olive oil per annum, all of which is imported, and sales topped £150 million a year for the first time in 2008. This is double the amount sold eight years ago and significantly more than the £90 million spent on vegetable oil. Half of UK homes now use olive oil compared with just 35% in 2001. The use of extra virgin oil for dressings, sauces, and as a dip for bread has increased as well as the use of olive oil for cooking. This latter use is replacing the use of other oils for cooking and frying foods in the UK. Interestingly, product research shows that the majority of Brits do not know that Spain is an olive oil producer even though it is the largest. They just like olive oil
Breaking in the Indian Cooking Oil Market
May 5 issue of the online “Olive Oil Times” speaks of a promotional and awareness campaign by the International Olive Oil Council in India. In its article entitled, “Big Market Getting Bigger,” the Times states that India ranks forth in the world in consumption of vegetable oils and is the third leading importer. The article states that, “The opening of India’s economy and increasing exposure to world trends in cuisine and other areas has slowly brought olive oil to the attention of health-conscious Indians. The growing popularity is shown in the increase in imports of olive oil, which has gone up from 2,300 tons in 2007 to around 4,500 tons in 2008. Demand is estimated to increase to 42,000 tons in 2012, with the growing middle class affluence and concerns about health and fitness.”
As this information shows the growth of olive oil consumption in what has become the world’s most populous nation is becoming exponential.
Good Food is Becoming a Good Investment
People use olive oil because of its taste, cooking qualities, and, increasingly, its heart healthy qualities. People invest in the rising consumption of olive oil for profit.
The Mediterranean Basin is historically the producer and consumer of olive oil. Its climate is conducive to growing olive trees. However, the vast majority of production is on the North of the Mediterranean Sea in Spain, Italy, and Greece. As worldwide consumption outstrips supply the major producers will have a hard time keeping up. Thus orchards are being planted in North Africa. Tunisia is already the forth leading producer at around 8% of total production. Now Algeria is embarking on a huge program to plant olive trees, a million hectares.
Investors looking to profit from the growth of olive oil consumption may do well looking at projects in a country like Algeria where soil and climate are conducive to growth the arbequinia olive in hyper intensive culture for local processing and international export. Projects that will be successful will pick the right olive variety, build processing plants near to production to optimize quality, and have international partners or parent companies in order to penetrate international markets.