Where does olive oil come from?

In 2023 Spain produced 854,001 tonnes, 33% of the world's 2.6 million tonnes (FAOSTAT). Italy followed with 14%, then Turkey (Türkiye) (9%), Greece (8.7%) and Tunisia (8%). The top five account for 72%, 36 countries reported output and 8.7% came from outside the top ten. World production changed -25% over the ten years to 2023 and -3% on the previous year.

Within Spain, Andalusia and above all the province of Jaén account for much of national and therefore world output, in groves that run for tens of kilometers unbroken. Italian production is scattered from Puglia and Calabria to Tuscany and Sicily, Greek output concentrates in the Peloponnese and Crete, and Tunisia, Morocco, Turkey (Türkiye) and Portugal make up most of the rest.

Two features make annual figures jump. Olive trees alternate bearing, cropping heavily one year and lightly the next, and the crop turns on spring rain and summer heat. World production changed -29% over the five years to 2023, a swing driven mostly by drought in the western Mediterranean rather than by any change in planting.

Spain was the largest exporter of olive oil (HS 1509) in 2024 with 42% of world export value, ahead of Italy (19%), on world trade of $16.2 billion (CEPII BACI). Italy was the largest importer with 20%.

Olive oil is unusual in that the same countries appear high on both lists. Italy is at once the second largest exporter and the largest importer, because it buys Spanish, Greek and Tunisian oil in bulk, blends and bottles it, and sells it on. Spain itself takes 9.5% of world imports for the same reason.

Tunisia is the largest exporter outside the European Union and sells mostly in bulk, so its share of trade by value understates its share by volume. The United States, with 19% of imports, is the largest market that grows almost none of what it uses.

There is no futures market and no free public benchmark price for olive oil, so this site quotes none. What exists instead is official monitoring: the International Olive Council publishes producer prices from the main origins, and the European Commission publishes representative prices from Spanish, Italian, Greek and Portuguese markets. These are reported prices for bulk oil at named places, not a traded benchmark.

Price is set by grade, and grade is set by chemistry and taste rather than by refining. Free acidity, peroxide value and a trained panel tasting place an oil in a category: extra virgin at the top, with no sensory defect and low acidity, then virgin, then lampante, too defective to sell as it stands. Bottled retail prices follow bulk by months.

An olive tree crops heavily one year and lightly the next, and whole regions swing together because they share a climate. Pruning and irrigation moderate the cycle, but a large crop and a small one usually arrive in successive campaigns.

The crop is decided in spring, when rain and moderate temperatures are needed for flowering and fruit set. Heat during flowering aborts the flowers outright, and a dry winter leaves rainfed groves without the soil moisture to carry fruit through summer.

Xylella fastidiosa, first found in European olives in Puglia in 2013, kills mature trees and has forced clearance and replanting under quarantine rules. Because a productive olive tree takes years to establish, disease losses reduce capacity for a decade rather than a season.

The premium for extra virgin over refined and pomace grades is large, which creates a standing incentive to mislabel. Conformity checks, panel tastings and customs testing therefore price the market as much as supply does, since an oil downgraded on test loses much of its worth.

Oil keeps for a year or more in nitrogen-blanketed tanks, so stock carried from the previous campaign is part of supply. A small harvest after a large one is absorbed by inventory; two small harvests in a row exhaust it, which is when prices move violently.

Olives are harvested from October to February, picked green for peppery, bitter oils and riper for milder ones. Traditional groves are beaten or shaken by hand, while intensive hedgerow plantings are taken in one pass by a straddle harvester. Fruit bruises and ferments quickly, so the hours between picking and milling do much to set the grade.

Milling is mechanical throughout. Fruit is washed, crushed to a paste, the paste malaxed, stirred slowly so oil droplets coalesce, and the oil separated in a centrifuge. Nothing is added and no solvent used, which is why virgin olive oil is closer to a fruit juice than a seed oil. The temperature held during malaxation is what cold extraction means.

The oil is settled or filtered, classified by laboratory analysis and by a tasting panel, then stored under nitrogen away from light and heat. Lampante grade goes to a refinery, where neutralizing and deodorizing strip out the defects; refined oil is blended back with a little virgin oil and sold as plain olive oil.

Almost all olive oil is eaten, as a cooking and dressing oil and as an ingredient in canned fish, sauces, spreads and baked goods. Premium grades are bought for flavour rather than function, while refined and pomace grades go into food service and manufacturing where the taste of extra virgin would be lost.

By-products are substantial, because the fruit is mostly not oil. Pomace, the wet residue of skin, pulp and stone, is dried and solvent-extracted for pomace oil and then burned as biomass. Olive mill wastewater is a real disposal problem, high in polyphenols and damaging to soil life if spread untreated, and it is increasingly processed for those same polyphenols.

Mills sit within an hour or two of the groves because the fruit cannot wait. Bulk oil then moves by road tanker and flexitank to bottling plants concentrated in Italy and Spain. Blending and bottling is where much of the value, and nearly all the branding, sits.

The trade is not physically fragile: oil ships at ambient temperature in tankers, flexitanks and drums, and keeps for a year. The exposure is to quality and provenance. Blending oil from several countries into one bottle is legal and routine when labelled correctly, and mislabelling is the sector's persistent enforcement problem.

The structural risk is a Mediterranean-wide weather event. Production sits on one climate zone that is warming and drying, so a drought reaching Spain, Portugal, Italy, Greece and Tunisia at once removes most of world supply, and a replacement tree takes years to bear.