As California’s olive oil industry expands and refines, designations of various grades of oil are becoming more distinct and more identifiable.
Consumers will face challenges as they learn to differentiate between extra virgin (high-quality) and oil pressed from the pomace of cull olives. All of the oil is expected to move through one market level or another.
Help is on the way. A new California law specifies and adopts international olive oil grades. How that will affect marketing and movement of the growing supply of oil is discussed in a report by two agricultural and resource economists at the University of California, Davis.
Assistant Professor Travis Lybbert and Ph.D. candidate Christopher Gustafson wrote about the law and its effect in the January/February issue of Update, published by the university’s Giannini Foundation of Agricultural Economics.
They point out that olive oil consumption in the United States has increased 650 percent since 1980. Most of it has been supplied by imports, but with California’s olive oil acreage climbing from 1,000 or two to 25,000, soon foreign supplies will face fierce domestic competition.
While supply volume has exploded, consumer understanding of the various grades of olive oil has lagged behind. The authors of the report believe heightened consumer awareness of the various olive oil standards and grades will bring about changes in the marketing strategies of oil producers. However, they believe that will occur slowly.
They project that increased sophistication by consumers will tend to benefit high-quality producers while impacting producers of lower-quality oils negatively.
For producers of high- quality oil the goal is extra virgin olive oil (EVOO), recognized internationally. Below that designation are virgin, refined and olive-pomace categories. The latter of the three grades established by the International Olive Oil Council (IOOC) results when olive pomace (flesh of the fruit and seed residue) are pressed to extract oil.
Olive-oil consumers in California now have additional label information to help them choose between various quality levels displayed on store shelves. To gain the most from the printed data they will need to understand what the grade standards imply.
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