Rising Olive Oil Costs Impact Signature Dishes in European Union Nations. Recently, there has been an increase in the expense associated with signature dishes across European Union countries, with experts attributing this trend to soaring olive oil prices. This surge in the cost of olive oil has led to higher expenses in crafting signature dishes in Italy and Spain, despite a general decline in inflation, as per a recent report by Bloomberg.
Based on data from Bloomberg’s monthly Pizza and Paella indexes, which track the expenditures of Italian and Spanish households in preparing these iconic dishes, the cost of ingredients for a classic Pizza Margherita witnessed an 8.2% year-on-year increase in September.
Similarly, the expense of making paella saw a substantial jump of 20.6% compared to the previous year.
Even though the headline inflation rates in both these nations stood significantly lower, at 5.6% in Italy and 3.3% in Spain, the cost of a pivotal ingredient, olive oil, exhibited a remarkable upswing. In Italy, olive oil prices surged by 43% in the past year, while in Spain, the increase was even more pronounced at 67% year-on-year, despite the country being the world’s largest producer and exporter of this essential cooking component.
Global olive oil prices reached record highs last month, surpassing $8,900 per ton, nearly doubling from the previous year. This price surge can be attributed to the exceptionally dry weather conditions in the Mediterranean region, which is responsible for two-thirds of the world’s olive oil production.
The drought has had a detrimental impact on crops and facilitated the spread of pests and diseases. In its September report, the US Department of Agriculture (USDA) revised its forecast for global olive oil output for the 2022-23 season, estimating a 25% decrease compared to the prior year and the five-year average, with only 2.5 million tons projected.
Additionally, the European Commission issued a warning last week, suggesting that olive oil prices will likely remain elevated for another season due to the ongoing challenges in the olive oil production sector.