MARK KET NEWSL LETTER No 50 – Ma ay 2011
TURKEY: OLLIVE GROWIN NG IN EXPAN NSION After rejoinin ng the memb bership of the Internation nal Olive Cou uncil just ove er a year ago, Turkey will be hosting g the 17th extra aordinary se ession of the Council, to be b held in Isttanbul betwe een 27 June and 1 July 2011. For thiss reason, we have h chosen n Turkey as the focus for this month’s s newsletter. The olive trree has bee en cultivated d in Turkeyy since time e immemoria al. Its signifficance in th he country’ss agriculture iss apparent frrom the aid granted g to th he sector by the Turkish agriculture m ministry, whic ch has led to o a 35% increase in the nu umber of olivve trees with hin the space e of the last six s years. Tu urkey’s goal is i to become e the world’s second s bigge est producerr, after Spain n. Olives are grown on 791 000 ha of land, of which w 10 500 0 ha are dediccated to orga anic farming and a further 7 300 ha are a awaiting organic o certiffication. Orch hards are forr oil productio on in 72% of o the crop area, versuss 28% for ta able olive production, p a although this s percentage e breakdown tends t to varyy from one se eason to the next. The av verage breakkdown for the e last five cro op years hass been 73% and a 27%, resspectively. In n the last five e years, the area a under olives o has exxpanded by +129 000 ha a (+19.5%) an nd industry fo orecasts are for it to swell to 1 000 00 00 ha by 2015. The modern nisation of the olive oil processing industry is also eviden nt from the changes in the figures. According to o the statisticcs available in 2005, Turkkey had 1 03 30 olive oil mills, m 430 of w which were equipped with h modern conttinuous-proccess systemss. By 2010 th here were 1 250 mills, off which 1 10 00 were mod dern two and d three-phase facilities, 50 0 operated presses p and super-presse es and 100 were w traditio onal mills. Th here are 400 0 olive oil refin neries and nine olive-pom mace oil extra action plantss. Olive oil pro oduction in Turkey T has ju umped up and down due to the phe enomenon o of alternate crop c bearing. However, in n the last thrree seasonss, it has reco orded a constant increase (see graph below). In 2009/10 itt produced 14 47 000 t of olive o oil, equa ating with 5% % of world prroduction and ranking it sixth behind Spain, Italy, Greece, Syrria and Tunissia in that ord der. For 2010/11, it expe ects to produ uce 160 000 t, showing a season-on-season increase of +9% %. According g to official estimates, Turkey T expe ects its outp put of olive oil o to rise to o 300 000 t ovver the nextt five years. Turkish table olive prod duction has climbed c by 3 39% in the last five crop p years, rising g from 280 000 t in 2005 5/06 to 390 000 0 t in 2009 9/10. This la ast tonnage rrepresents 16% 1 of world d production, placing Turkkey in third place p behind d Spain and Egypt. Fore ecasts signall a level of production p off 650 000 t byy 2015. Tu urkey – Olive oil (1990/91-2010 0/11) (1 000 t)
Tu urkey – Table olives (1990/91-2 2010/11) (1 000t)
According to o industry sources, s desspite the exxcellent outlo ook for olive e oil producction in Turk key, olive oil accounts forr only 9% off the 1.3 million t of vege etable oils co onsumed in the country.. This low level is due to o poor consum mer awarene ess of the he ealth-promotting attributes of olive oil. However, when the Tu urkish health h authorities started s to advvise Turks to o include olivve oil in their diet, consu umption bega an to rise, go oing up from m 50 000 t in 2005/06 2 to 110 1 000 t in 2009/10. Pe er capita con nsumption wa as 1.4 kg in 2010 but is expected to o reach 5 kg by b 2015. In 2009/10, 260 000 t of table olives were consumed in Turke ey, showing an increase of +8% from m the season n before. In pe er capita term ms, consump ption works out o at 3.5 kg, and is foreccast to climb to 6 kg by 20 015. In 2009 and d 2010, combined exporrts of olive oil o and table olives accou unted for resspective 1.8% and 1.5% % shares of total t Turkish h agricultura al exports. This T dip in exports ha as been offsset by high her domesticc consumption n. In 2009/10 0, Turkey exxported 29 50 00 t of olive oil, chiefly to o the EU/27,, USA, Saud di Arabia and d Japan by de escending ord der of volume. In the sam me season it exported 65 5 543 t of table olives. Source: Interna ational Olive Cou uncil
pa age 1
MARKET NEWSLETTER No 50 – May 2011
1. INTERNATIONAL TRADE: +22% IN FIRST FIVE MONTHS OF 2010/11 In the first five months of 2010/11 aggregate imports by the six countries listed in the table below rose by 120 386.1 t (+22%) compared with the same period the season before. In the six months between October and March, imports increased into Australia (+2%), Brazil (+19%) Canada (+17%) and the USA (+17%) versus the same period of the previous crop year. Conversely, from November 2010 onwards, Japanese imports have been lower every month than the year before, recording a cumulative decrease of 10%. EU data were not available for March at the time of writing, but the figures for the first five months of the crop year show a very large increase (27%) compared with the season before.
MOVEMENTS IN PRODUCER PRICES Graphs 1 and 3 track the weekly movements in the producer prices paid for extra virgin olive oil and refined olive oil in the top EU producing countries. The monthly price movements for the same two grades of oil and refined olive-pomace oils are shown in Graphs 2, 4 and 5 respectively. •
Extra virgin olive oil: Comparison with the same period of the year before shows that prices have dropped by 4% in Spain (€1.98/kg) but increased by 5% in Greece (€2.04/kg) and 45% in Italy (€3.90/kg) – Graph 1. Prices have recorded a very steep increase in Italy in recent weeks, contrasting with the drop in Spain, although they now appear to be levelling off at around €3.90/kg. This confirms the growing distance between the prices paid to producers in Italy and those paid in Spain and Greece.
Graph 1 Source: International Olive Council
page 2
MARKET NEWSLETTER No 50 – May 2011
Graph 2
Refined olive oil: The same comparison for refined olive oil shows that prices have gone down by 2% (to €1.73/kg) in Spain and 4% (€1.87/kg) in Italy (Graph 3) from season-before levels. No data are available for Greece. The very mild price recovery that began in August 2010 continued through to mid-December, since when the trend seems to have reversed. The bulk of this recovery appears to have been lost although there have continued to be minor price fluctuations since the summer. Unlike the price of extra virgin olive oil, the price commanded by refined olive oil differs very little (0.14%) between Italy and Spain.
Graph 3
Source: International Olive Council
page 3
MARKET NEWSLETTER No 50 – May 2011
Graph 4
Graph 5
Source: International Olive Council
page 4