Global Olive Oil Market Dynamics: Week 22/2025
The olive oil market has entered a critical phase of recalibration as of late May 2025, marked by diverging regional price trends, production recoveries in key Mediterranean regions, and evolving trade policies. Spain’s dominance in global supply continues to shape market dynamics, while Italy’s premium positioning and Greece’s competitive pricing reflect fragmented quality and inventory realities. Consumer prices are gradually easing from historic highs, though retail adjustments lag behind wholesale declines. Meanwhile, geopolitical factors—particularly U.S. tariff uncertainties—introduce volatility into long-term trade patterns. This report synthesizes the latest data across production, pricing, trade, and regulatory developments to provide a comprehensive overview of current market conditions.
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European Market developments
Last week, the Spanish olive oil market closed with a noticeable sense of tension and uncertainty. Suppliers and mills alike are expressing their dissatisfaction with the current low prices that are dominating the market landscape. This dissatisfaction is not just a fleeting sentiment; our team of experts predicts that this tension is likely to persist until at least August or September, which is when the market will start preparing for the new crop, which is expected to arrive and potentially alter the dynamics of the market.
Producers are feeling pressure to sell their existing stock to generate the necessary cash flow to cover their ongoing expenses. With the market conditions as they are, there is little incentive for producers to hold onto their inventory, as the difference in selling now versus waiting until September is minimal. Their primary goal is clear: they need to empty their tanks and make room for the new harvest.
In Jaen, many mills still have substantial stock, although some have successfully emptied their tanks, signaling a slight market shift. Despite this, the overall pricing landscape remains difficult. An oversupply of low-quality extra virgin olive oil is driving prices down, resulting in fewer transactions. Interestingly, the lampante category of olive oil is currently serving as a buffer, helping to stabilize the market despite the pressure from low prices. Analysts attribute this correction to Spain's record production of 1.41 million tons for the 2024/25 season and rising mill inventories of 666,458 tons. Additionally, buyers are hesitant to enter into forward contracts, anticipating further price declines, which adds to the ongoing price-pressure cycle.
A key question that looms over the market is how Greece will respond to the ongoing developments in the Spanish olive oil sector. Despite the falling prices, producers in Spain still hold onto the hope that they will be able to sell their products during the summer months, which are typically a busy time for olive oil sales.
Meanwhile, in Greece, the market has reached a state of stagnation, with prices dropping by approximately 10 cents per kilo. Producers and stakeholders are in a holding pattern, waiting to see how the situation will unfold in the coming weeks. The market remains challenging, as producers must come to a consensus on whether to sell at the current prices, which are becoming increasingly difficult to navigate. Additionally, media reports are suggesting that prices may continue to decline, adding to the uncertainty.
At this juncture, buyers, particularly those from Italy, are exhibiting hesitance when it comes to purchasing olive oil from Greece. The good quality extra virgin olive oil that is available is priced similarly to organic extra virgin olive oil from Spain, which complicates negotiations and makes it difficult for Greek producers to secure sales. This complex interplay of factors is creating a challenging environment for all parties involved in the olive oil market.
Italy maintains a premium status amid supply strain
While Spain’s extra virgin olive oil (EVOO) prices remain subdued, Italy continues to defy broader market trends. As of May 25, Italian EVOO prices soared to €9.60/kg—a 52.4% increase compared to May 2024. This sharp rise is primarily attributed to tight supply conditions, as Italy’s 2024/25 production declined to 224,000 tons, forcing the industry to rely heavily on carryover stocks.
Additionally, Italy’s market is largely insulated from commodity price erosion thanks to its focus on high-quality production. More than 68% of the country’s EVOO exports qualify for Protected Designation of Origin (PDO) status, ensuring product differentiation and maintaining a premium position in global markets.
Greece and Tunisia Compete on Price
In contrast, Greece and Tunisia are adopting aggressive pricing strategies to retain market share. Greek EVOO prices have stabilized at €3.96/kg following a steep 46% year-on-year decline. Tunisia, with similar pricing at €3.88/kg, has experienced a 29% drop in export revenues as global prices eroded. Both countries are now under increasing pressure to clear their inventories before the arrival of the 2025/26 harvest.
Promising outlook for 2025/26 harvest and evolving export dynamics in the Mediterranean
Early indicators for the 2025/26 campaign point to a potentially strong harvest across much of the Mediterranean. In Jaén, Spain’s most productive olive-growing province, flowering intensity is up by 23% compared to the previous year, supported by favorable May temperatures. Greece also shows positive signs, with orchards in the Peloponnese exhibiting 15–20% more flowering nodes than in 2024. Italy, however, faces a more uncertain outlook; in Puglia, one of its primary producing regions, April hailstorms have damaged approximately 12% of olive buds, raising concerns about yield recovery.
Export dynamics across the Mediterranean are also shifting. Tunisia has managed to maintain stable export volumes, but falling prices have resulted in a 29% drop in revenue. Turkey has emerged as a cost-competitive alternative, pricing EVOO at €4.96/kg and capturing 8% of the European Union’s import market. Portugal has seen a 22% increase in bulk oil shipments to Spain, where these volumes are processed and blended for re-export to Asian markets.
Market Projections: Q3 2025
Looking ahead to the third quarter of 2025, Spanish EVOO prices are expected to stabilize near €3.40/kg, as mills resist further price cuts. Italian premiums may soften slightly, with projections around €8.90/kg. On the trade front, growth in U.S. imports is likely to slow to between 4% and 6% per quarter, as new contracts are deterred by tariff concerns. Globally, early yield forecasts suggest a production range of 3.8 to 4.1 million tons for the 2025/26 season, which could tip the market toward oversupply in 2026.
Given this outlook, strategic actions are essential. Producers are advised to secure forward contracts during the upcoming period of price stability and to diversify their commercial strategies beyond the European Union. Buyers can take advantage of lower-priced Spanish and Greek oil for bulk procurement needs, while reserving Italian EVOO for premium product lines. Investors should monitor shifts in U.S. trade policies and developments in Southern Europe’s irrigation infrastructure, both of which will significantly influence medium-term market dynamics.
The global olive oil market remains at a crossroads, with stakeholders needing to balance an emerging abundance of Mediterranean supply against the backdrop of trade protectionism and evolving quality standards. Navigating this complex environment will require both agility and strategic foresight.
Sources:
EU Commission Olive Oil Market Dashboard
International Olive Council Reports
USDA Foreign Agricultural Service
Italian Ministry of Agriculture (MASAF)
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