Argentina Plans to Double Its Olive Production by 2020
Argentina expects its olive oil and table olive production to double by 2020, according to the government’s Agri-Food and Agribusiness Strategic Plan, which names the olive as one of the country’s fastest-growing crops. The plan foresees an olive area of 110,720 hectares and would, the reports say, place Argentina among the world’s leading producers. Here is what the plan says, what the export figures look like, and what I would want to see before taking the target at face value.
What was announced
The projection comes from the Strategic Plan (known in Argentina as the PEA) prepared by the Ministry of Agriculture, Livestock and Fisheries, and was reported in the Argentine press last week and by Olive Oil Times today. According to the La Pampa daily La Arena, olive oil and table olives, which generated more than 30 million dollars of exports in the first quarter of 2011 alone, are set to double their production by 2020.
“The country has the potential to become one of the main players in world olive growing,” said Ángel César Matías, a specialist with the national agricultural technology institute, INTA, in Catamarca. Olive Oil Times adds that the plan expects the olive area to reach 110,720 hectares and annual production to pass 100,000 tons, though the reports do not make clear whether that figure is for oil alone.
| Argentina’s olive sector | As reported |
|---|---|
| Olive oil and table olive exports, first quarter of 2011 | More than 30 million dollars |
| Olive oil exports alone, first quarter of 2011 | 2,494 tons, 9 million dollars FOB |
| Average export value of that oil | 3,614 dollars per ton FOB |
| Planned olive area | 110,720 hectares |
| Production target | Double by 2020 |
The olive oil export figures come from the government’s regional economies office, as quoted by La Arena. Olive Oil Times also notes a regional olive oil expo organized by INTA in Salta province on April 20 to 22, aimed at teaching consumers how oil is made from grove to table.
Why the growth, and why caution
Argentina’s olive boom is not new. Much of the new planting in the northwestern provinces was financed under the country’s tax deferral schemes, and exports have been growing for years, as we reported when its olive exports set a new record. Foreign investors have followed, as when Australia’s largest olive oil company expanded into Argentina.
But a target on paper is not a harvest. In 2010, growers in La Rioja were already asking for an agricultural emergency because of trouble selling their crop, and the province declared a plant health emergency over Verticillium wilt, which the Catamarca paper El Esquiú said was hitting small traditional growers hardest. Doubling output also means finding buyers for it, at a time when world prices are low and Spain is bringing in a very large crop.
- Argentina harvests in the southern autumn, so its fresh oil reaches northern markets when Mediterranean oil is months old.
- Its home market is small, so extra oil has to be exported, mostly in competition with bulk Mediterranean oil.
- Growth will depend on water, disease control and the price the world pays, not only on planted hectares.
What it means for buyers
More Argentine oil is good news if it arrives fresh and labeled with its origin and harvest date. Southern hemisphere oil is at its best in the northern spring and summer, exactly when many European bottles on the shelf are getting tired. Our guide on how to read an olive oil label shows where to look for both.
Every New World producer has a plan to double output, and the plans are usually right about the trees and wrong about the market. Planting is the easy part. The hard part is selling fresh oil under your own name instead of pouring it into someone else’s blend at a bulk price, and that takes years of promotion that rarely appears in the government’s figures.