Spanish customers near the Portuguese border are deciding to buy their olive oil outside of Spain, the world’s largest producer, because of its increased price.
Spanish customers are buying olive oil from Portuguese supermarkets due to the increased price of the product within their own borders.
It has led Spanish consumers, particularly from Galicia and Andalusia, to purchase olive oil in supermarkets near the border with Portugal, according to an article by El País.
There have been increases in olive oil prices reported throughout this year by the Spanish media. For instance, an article by El Mundo published today reported a 42% average price increase in virgin and extra virgin olive oil in Spain since the start of 2023.
Though Portugal has reportedly had comparable increases in olive oil prices, the difference in price can be accounted for by the droughts in Spain and the presence of 5% VAT on olive oil, according to El Pais. Moreover, olive oil is on the list of products with no VAT application in Portugal.
Spain has been the largest producer of olive oil in the European Union for the last decade, with Portugal being the fourth largest.
Official data from the European Commission shows that Spain produced nearly 1.5 million metric tons of olive oil from September to May in the 2021–2022 harvest season. By contrast, in the 2022–2023 season, Spain has produced less than 50% of that amount. But with its 664,000 tons, the country remains the largest olive oil producer in the EU this season, which shows how important Spanish producers are in the global olive oil market.
On the other hand, Facua, a Spanish association of consumers, published a study yesterday that suggested a significant increase of the olive oil retail price is caused by price speculation from supermarkets.
Specifically, they reported that the supermarkets added 2,57 euros (2.75 dollars) of the price increase on olive oil. Nina Calviño, the first deputy prime minister of Spain, defended Spanish supermarkets claiming that she had “no knowledge” of price speculation on their part.
The average price of extra virgin olive oil in Portugal increased to 6,59€ per liter in July of 2023, with a continuous uptrend since March 2023, according to the data available on the ministry of agriculture. It cost 4,62 euros per liter on average in August of 2022.
Meanwhile, the cheapest widely available extra-virgin olive oil sits at 6,79€ per liter on the website of the organization of consumers in Spain.