The price of premium-quality extra virgin olive oil in the wholesale market fell this month to $2,900 a tonne, the lowest since 2002 and down more than half from nearly $6,000 a tonne in 2005, according to the International Monetary Fund.
Olive oil is suffering from strong competition from cheaper varieties of vegetable oil. Eroski, a popular supermarket chain in Spain, sells sunflower oil at 1.25 euros a litre, against average-quality olive oil at 1.99 euros and premium extra-virgin olive oil at 3.25 euros.
Spain will consume as much olive oil this year as it did in 2002, according to the International Olive Oil Council, and Greece and Italy will see their domestic demand falling back to 1995 levels. The drop in Spanish, Italian and Greek demand has been only partially offset by higher consumption elsewhere.
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