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Greeks face olive oil crisis

- by Andy Cornish

No visitor to the Greek islands will escape the acres of olive groves that carpet the island landscapes, from Corfu to Crete.

Olives have been a staple of the Mediterranean diet for centuries and more than 100 varieties are grown in Greece and the Greek islands, thriving in the long hot summers and mild winters.

But this year's winter olive harvest in Greece has been a troubled one. Not only is the 2014-15 harvest below average but prices for Greek extra virgin olive oil have been falling despite low yields in other major producers in the Mediterranean.

Greece is the third largest producer of olives and olive oil with an annual output of 430,000 tons. And Greeks use more olive oil than anywhere else in the world with an impressive 18 kilos per person each year.

However, the best Greek olive oil is exported to Italy, where it is often bottled and resold as Italian olive oil. And despite a poor harvest in Italy this year, Greeks are still getting less per kilo than previous years as Italian buyers are paying only €3 per kilo this year compared to €4 in 2013-14.

The poor Italian crop has led to unconfirmed reports of olive fruit being shipped across the Adriatic from Greece for the first time ever.

The high demand should have made this year's harvest very profitable and bring good times for Greek olive growers.

But heavy autumn rains and strong winds have hit Greek olive producers hard in key areas such as the Peloponnese while big Greek island producers such as Crete and Lesvos have struggled to get a decent crop.

It has forced many producers to sell at low prices to cover their costs, but it's not only poor weather that is being blamed for the setback.

Greek olive oil producers also point to the economic crisis and the failure of the government to promote Greek olive oil abroad or to control state aid handouts to big growers.

As a result Italian and Spanish olive oil is much better known, taking pride of place, for example, on British supermarket shelves while Greek olive oil is barely seen.

So Greek olive oil mills and wholesalers are forced to sell to Italy in bulk to make a quick turnaround instead of using their profits to promote and market Greek olive oil on the international stage.

The Italian olive oil industry, in contrast, invests heavily in marketing and promotion, and Italian olive oil not only has a better reputation but also nets the largest market share, even though much 'Italian' olive oil originates in Greek olive groves.

Greek growers are understandably furious that the world reputation of Italian olive oil is partly sustained by imports of high quality Greek olive oil.

To add to the confusion, reports are growing this year of some Greek olive oil firms are now importing low grade Spanish olive oil and mixing it with their own virgin olive oil in a bid to cut costs, a practice that Italian producers have been accused of for years.

The use of low grade Spanish oil is thought to be another reason that Greek producers have seen prices fall this year and it's prompted the Greek government to pledge to strengthen controls to protect the quality of Greek olive oil.

But despite the short term drop in olive oil prices, the poor harvests are bound to have an effect long-term and British cooks can expect to pay more for their quality olive oil later this year.

While many areas of Greece were hit by autumn wind and rain, drought conditions in much of southern Europe, notably Spain, at a critical time of the year are blamed for poor harvests.

European suppliers were hoping that a good Greek olive harvest would bridge the gap but the poor weather and low Greek yields has dashed their hopes with the olive harvest in some Greek areas down by as much as 50%.

Meanwhile an olive tree disease that is spreading across Italy is causing widespread concern. Around 800,000 trees are reported to be infected in the Apulia region in the 'heel' of Italy.

Apulia accounts for about a third of the total Italian olive crop but many trees are infected with the bacteria 'Xylelle fastidiosa' which causes olive tree bark to dry out and branches to be fruitless.

To make matters worse the Italian harvest has also been hit hard by the olive fruit fly. Producers have now deemed Italy's 2014 olive harvest the worst in its recorded history, partly because of the climatic conditions that helped the olive fly proliferate.

There are still enough stocks to keep olive prices stable in the UK supermarkets but consumers are advised to stock up while they can. They can expect to see a large hike in prices this spring.

Olive oil producers are used to good and bad years in what has always been a very cyclical industry but all agree that the harvest throughout southern Europe this year has been particularly poor and growers face financial hardship.

This latest olive crisis will not only affect the Greek economy but also those consumers in the UK that love their Greek olive oil.