Rising Olive Oil Prices
Spain's drought sets off a rise in olive oil prices
By EMMA ROSS-THOMAS
Reuters News Service
MADRID, SPAIN -
A scorching drought in Spain has sent olive oil prices soaring as farmers in the world's top producer estimate this year's harvest could fall almost 30 percent.
Extra virgin olive oil is being quoted at $3,620 a ton, some 20 percent above prices of a year ago, as the combined effects of frost and now drought ravage the crop.
"Consumers won't pay those prices. ... Everything has a limit," said Oscar Lopez, the market administrator of an olive oil futures exchange set up last year.
The industry estimates people consume more olive oil each year.
Even before the drought started, olive oil producers were trimming their estimates after frosts destroyed some of their trees. Spanish Cooperatives Federation reckons about 4 percent of all Spain's olive trees lost this year's harvest because of the frosts.
Some of those trees will have to be replanted, and so will not produce for about five years, said the federation's olive oil expert, Javier Lara.
Spain has had below-average rainfall since September, and farmers are hoping for rain before the November harvest.
Italy is the world's No. 2 producer, followed by Greece.
By EMMA ROSS-THOMAS
Reuters News Service
MADRID, SPAIN -
A scorching drought in Spain has sent olive oil prices soaring as farmers in the world's top producer estimate this year's harvest could fall almost 30 percent.
Extra virgin olive oil is being quoted at $3,620 a ton, some 20 percent above prices of a year ago, as the combined effects of frost and now drought ravage the crop.
"Consumers won't pay those prices. ... Everything has a limit," said Oscar Lopez, the market administrator of an olive oil futures exchange set up last year.
The industry estimates people consume more olive oil each year.
Even before the drought started, olive oil producers were trimming their estimates after frosts destroyed some of their trees. Spanish Cooperatives Federation reckons about 4 percent of all Spain's olive trees lost this year's harvest because of the frosts.
Some of those trees will have to be replanted, and so will not produce for about five years, said the federation's olive oil expert, Javier Lara.
Spain has had below-average rainfall since September, and farmers are hoping for rain before the November harvest.
Italy is the world's No. 2 producer, followed by Greece.
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