Spanish olive oil: why it dictates the global price

1. Why Spain Matters So Much for Olive Oil

When talking about olive oil and raw material prices, one thing is certain: you can't just think in Italian terms.

To truly understand what's happening in the market, you need to look primarily at Spain and Tunisia, which today are the two countries that most influence quantities, availability, and prices.

Spain: The World's Leading Olive Oil Producer

Let's start with Spain, which remains the global benchmark.

Spain is the world's leading producer of olive oil and, in favorable years:

• it accounts for about 35–40% of global production;
• it is clearly the leading European producer;
• it produces much more oil than Italy, Greece, or Portugal.

To put it in perspective:

it's as if, in a class of 20 students, one student did almost half of the homework for everyone. If that student is in good form, the system works. If they slow down, the entire market suffers.

Spanish Production and Olive Oil Prices

Spain's influence is such that:

• if the Spanish harvest is poor, olive oil becomes less available and prices rise;
• if production is abundant, supply increases and prices tend to fall.

This is why every year the market closely observes rainfall, flowering, and harvest in Spain: a large part of the global balance depends on it.

Tunisia: The Big Player in Recent Years

Alongside Spain, another key country has emerged strongly in recent years: Tunisia.

Tunisia is currently:

• one of the world's largest olive oil producers;
• capable, in some years, of becoming the second largest producer in the world, surpassing Italy and Greece;
• an increasingly relevant player, especially in the bulk oil and blend market.

In particularly favorable years, Tunisian production can reach very high levels, approaching those of major European players (while remaining, overall, lower than Spain).

2. How Spain Produces So Much Olive Oil

One of the most frequent questions when discussing the olive oil market is: how does Spain manage to produce such high volumes compared to other Mediterranean countries?

The answer is not singular. It primarily depends on different agricultural models and strategic choices made in recent decades.

Hedge Olive Groves: The Super-Intensive Model

If we think of a traditional Italian olive grove, the image is clear:

• spaced trees;
• hills and steep terrain;
• harvesting partly manual or with mechanical aids.

In many areas of Spain, especially on flat land, the scenario is completely different.

How Super-Intensive Olive Groves Work

In super-intensive Spanish olive groves we find:

• dense rows, similar to vineyards;
• smaller plants, placed very close together;
• fully mechanized harvesting, with machines passing over the rows.

In simple terms, the concept is this:

many trees in a small space, designed to be harvested quickly by machines.

Why Super-Intensive Reduces Costs

The economic advantages of this system are evident:

• less labor needed;
• very fast harvesting times;
• significantly lower costs per kilogram of olives compared to traditional olive groves, especially in hilly areas.

And this is precisely one of the reasons why Spanish olive oil often manages to be more price-competitive than that of other producing countries.

Common Agricultural Policy and Investments: Why Spain Accelerated

Alongside the agricultural model, there is also an important historical and economic factor: the Common Agricultural Policy (CAP) of the European Union.

Investments in Technology and Modernization

Thanks to European funds, Spain has been able to:

• invest in new olive grove systems;
• modernize oil mills, making them more efficient;
• develop irrigation systems and advanced technologies;
• experiment with new olive varieties suitable for sup

3. Jaén and Poolred: Where Olive Oil Prices Are Born

3.1 Jaén: The "Wall Street" of Olive Oil

If you love extra virgin olive oil, there's a Spanish province you absolutely must know: Jaén, in Andalusia. Here, olive groves stretch as far as the eye can see and represent a large part of Spanish production, shaping most of the farm-gate prices of olive oil.

When is Jaén really important? Because the farm-gate prices registered here influence the trend of national and international markets: when EVO oil prices rise in Jaén, other markets often adjust accordingly, and when they fall, the opposite happens. For this reason, many operators refer to Jaén as the true "olive oil exchange."

3.2 Poolred: The Thermometer of Farm-Gate Prices

To understand how olive oil prices are formed, you need to know Poolred, the reference system for monitoring farm-gate prices in the spot market in Spain.

Poolred collects data from oil transactions between:

• Oil mills
• Agricultural cooperatives
• Large buyers (bottlers, industries, etc.)

From these transactions, average prices emerge for the main categories of oil:

• Extra virgin olive oil (EVO)
• Virgin olive oil
• Lampante olive oil

This data becomes the reference price list for commercial contracts and for operators' purchasing, selling, and storage decisions. 

3.2.1 Poolred Prices Updated for the 2025/2026 Season

Market values at origin for the 2025/2026 season show that:

• Extra virgin olive oil (EVO) stood at an average of approximately €4.55 per kg at the end of November 2025. 
• Virgin olive oil was close to €3.75 per kg in the same period. 
• Lampante oil moved around €3.45 per kg in the Spanish market. 

These prices reflect the recent trend in the Poolred market, where quotations are relatively stable or slightly decreasing due to seasonal pressures, but still significantly

4. When Olive Oil Becomes (Almost) Gold: The Years of the Great Crisis

Drought, Extreme Heat, and Skyrocketing Olive Oil Prices

In recent years, the extra virgin olive oil sector has experienced one of the most difficult phases in its recent history. A combination of extreme climatic factors has put the entire supply chain under pressure:

• increasingly hot summers, precisely during the delicate flowering phase of the olive tree;
• long periods of drought, with dams and reservoirs at historic lows;
• a collapse in production in many key areas, especially in Spain.

The result was inevitable: with less oil available and virtually no stocks, farm-gate prices for extra virgin olive oil reached record levels, at times nearing - and in some cases exceeding - €9/kg.

This increase was quickly reflected throughout the supply chain:

• on supermarket shelves,
• in restaurants,
• in supplies for the Horeca sector.

For many consumers, buying a bottle of extra virgin olive oil suddenly became an investment, no longer an obvious daily gesture.

How Families and Supermarkets Reacted

Faced with unprecedented prices, Italian families changed their consumption habits:

• some reduced quantities,
• some chose to use extra virgin olive oil only raw, preferring other fats for cooking,
• still others turned to private labels or cheaper seed oils.

At the same time, supermarkets strengthened the push for private label brands, often:

• bottled using oil from foreign sources, especially Spanish;
• offered at more competitive prices than historical brands.

In this context, Spain remained a benchmark for those who needed large volumes of oil at more "controlled" costs, even in the midst of a production emergency.

6. What Awaits Us in the Coming Years (and What It Means for Frantoio D’Orazio)

6.1 Towards a "New Normal" in Pricing

It's difficult to make perfect predictions, but we can get an idea.

It's likely that:

we won't easily see the crazy peaks of recent years (farm-gate oil prices near €9/kg) again;

but it's equally difficult to return to the very low prices of the past (like €2–2.5/kg), because everything costs more: energy, labor, materials, transport.

In short, we are moving towards a "new normal":

olive oil remains a precious product,

prices will be higher than a few years ago,

but with less of a roller coaster ride compared to the peak climate and stock crisis.

6.2 And Italy, in all of this?

For Italy, the lesson is clear:

we cannot compete with Spanish olive oil on price and large volumes;

however, we can win on other things:

quality,

typicality,

connection to the territory,

experience (tastings, tourism, pairings).

In practice, Italian oil must stop trying to play in the "commodity" category, where only price matters, and increasingly position itself as: a high-end extra virgin olive oil, linked to specific cultivars, territories, family histories, and virtuous production methods.