With the exception of the few South African olive producers who are primarily geared up for export, the majority of the country’s producers are not reaping the benefits of the global growth trends due to the dire local economic situation.
This is according to SA Olive Association CEO Vittoria Jooste.
This association represents the common interests of the South African olive industry and said the that global demand for olive oil has been on a growth trajectory for some time, with consumption outpacing production over the past three years.
However, despite the growth in revenue, input costs continue to rise while consumers’ wallets were shrinking.
Members consist of olive growers, olive oil producers, table olive producers, tree nurseries and olive importers. The majority of South African olive farms are small with almost half of the 195 registered olive growers being farms of less than 5 hectares.
Jooste said that although last year brought with it its own challenges, first and foremost rolling blackouts during the olive harvest and processing season, it still turned out to be a plentiful harvest for local growers. And Jooste said there is plenty opportunity for them as well. “The start of 2023 has seen an increase in import prices for olive oil, on the back of a shortage and the price increase of seed oil which transpired 2022.”
Furthermore, the association said that the total area under olive cultivation in South Africa has been doubling every 10-12 years and there was still more potential for further growth. It said that considering that there were 1.9m ha of agricultural land available in the Western Cape (prime olive growing area) and that only 250 000 ha of it irrigated, there was enormous scope for olive cultivation to expand.
They added that South African growers’ orchard management practices were constantly improving, from the pruning of olive trees to the management of soil and nutrients and the control of pests, a factor they attributed to the support of SA Olive’s research and development committee and its network of committed technical experts.
“Despite annual variances across the different growing regions, the total volume of olive oil produced annually in South Africa has doubled since 2008. If more land could be brought into sustainable production, both by reinstating abandoned orchards and by planting more olive trees, local output of olive oil could increase well above the 2 million litre mark,” the organisation said.
Jooste said that as the demand for healthier options continues to increase, local production of olive oil could maintain a steady growth trajectory in the forthcoming years. This presents the olive industry with a strong impetus for further investment in the medium and long term.”
The South African olive industry has been identified in the 2011 NDP as a form of “small-scale, labour-intensive agriculture” that should be supported to create jobs. Sadly, the spectre of further breakdown of infrastructure and economic recession loom large on the horizon for the sector.
With regard to table olives, around 1 400 tonnes of olives were produced, and about the same volumes were imported each year. The bulk of SA olive oil imports were said to be from from Spain, followed by Italy, Portugal, and Greece.
According to SA Olive, South Africa exports olive oil to neighbouring African countries, particularly Botswana and Namibia. Per capita consumption of olive oil was estimated at 0.08 litres per annum in South Africa. This was said to be a minuscule amount compared with the 12-36 litres of European countries.
According to the Fortune Business Insights Market Research Report published in September last year, the global olive oil market was projected to grow from $14.19 billion in 2022 to $17.79 billion by 2029, at a compound annual growth rate (CAGR) of 3.28% in the forecast period, 2022-2029.
BUSINESS REPORT