Deoleo Olive Oil Market Trends: Why the Worst May Finally Be Over

When an industry can finally look back on a difficult period and confidently declare that it is over, a certain kind of relief descends upon it. Deoleo appears to be in that situation at the moment. The CEO of the biggest olive oil company in the world, Cristóbal Valdés, stated that the harsh market cycle of 2022 to 2024 is “definitively behind us.” The company is based in Spain and produces brands like Bertolli and Carbonell. That’s a daring claim. It’s also difficult to completely dispute the point given how the numbers have changed over the previous year.

You must keep in mind how bad things really got in order to comprehend why this moment has significance. Due to prolonged droughts and unusually high temperatures, olive groves throughout southern Europe produced far less than anticipated. Particularly hard hit was the province of Jaen in Spain, which supplies about 25% of the world’s olive oil. In January 2024, Spain’s extra virgin olive oil wholesale prices reached a record 9.3 euros per kilogram. Bottles with anti-theft tags were found on supermarket shelves in some parts of Europe. That was a true reflection of how valuable the product had become, not a headline stunt.

According to the most recent data from the European Commission, those same prices are currently around 3.9 euros per kilogram. That’s a significant correction. This significant retreat is the result of increased rainfall in the main producing nations as well as a harvest season that appears significantly more promising than previous ones. After two years of sticker shock forced many consumers to choose less expensive options, Valdés has cited this supply recovery as the basis for what he refers to as a “more stable pricing environment,” which is enabling household demand to rebuild.

Whether this stability is long-lasting or merely a favorable window between challenging cycles is still unknown. The volatility of the climate has not decreased. Analysts have observed that the global supply of olive oil can fluctuate significantly from one harvest season to the next, and water scarcity in Spain, Italy, and Greece continues to be a structural concern. The industry seems to be letting go, though maybe not completely.

What’s truly intriguing—and a little surprising—is how Deoleo was able to make progress in the US market despite the challenging times. The CEO of the company attributed the increase in U.S. sales, among other things, to a redesign of the packaging. In particular, younger consumers who desire convenience in addition to quality seem to have responded favorably to the shift toward squeeze-format bottles, such as the Bertolli “Dress and Drizz” bottle.

According to reports, 40% of the category’s growth in the US is currently being driven by squeeze formats. It’s a significant signal. Unless there is a genuine shift in consumer behavior, a packaging change of that magnitude typically doesn’t have such a significant impact on sales.

A longer perspective appears to be reflected in Deoleo’s more comprehensive U.S. strategy. The company sells in about 70 countries and holds about 8.3% of the global olive oil market, but it views the US as a major growth opportunity, especially as more American households start using olive oil as a dietary staple rather than a specialty item. All income levels have seen an increase in the number of American households buying olive oil, indicating that the market isn’t merely rebounding. Its base is gradually growing.

The company’s recent financial performance encourages cautious optimism. Deoleo reported a net profit of 20 million euros and a 50% increase in EBITDA to 50 million euros, along with modest gains in the U.S. and Italy and a 1.8 percentage point increase in market share in Spain. The cost of raw materials decreased by about 50%, which significantly boosted margins. The outcome of the upcoming harvest will determine whether those cost conditions continue into the second half of 2025 and into the next cycle.

Deoleo seems to have handled the worst of this with more poise than the turbulence warranted. The company’s investment in innovation, not only in sourcing and pricing strategy but also in something as tangible as a bottle’s shape, reveals how the industry is attempting to rethink how olive oil fits into contemporary kitchens. Only the upcoming growing season will be able to determine whether the market remains stable long enough for those changes to compound.