by Roberta Ruggeri and Enzo Gambin
AIPO Economic Office
Interregional Association of Olive Producers
The Italian extra virgin olive oil market is currently dynamic, although there is a limited product availability and there have been drops in sales volumes. Attention is now turned to the beginning of the olive harvest campaign; production estimates and, consequently, olive prices are not yet clear. The main question we are asked is: “What is theWhat will be the prices of Italian extra virgin olive oil for the next 2025??”.
It is certainly not easy to answer, since there are so many variables at play. However, one thing we can do is try to analyze the data from the last four years and process them using a “linear regression statistical model”.
Historical analysis
2021: average price: 4-5 €/kg
Influencing factors: good production, favorable climatic conditions.
Trend: stability with slight increases towards the end of the year.
2022: average price: 6-7 €/kg
Influencing factors: drought and reduced production.
Trend: price increase due to shortage of supply.
2023: average price: 8-9 €/kg
Influencing factors: adverse weather conditions and increasing energy costs.
Trend: constant growth in prices.
2024: average price: 9-11 €/kg
Influencing factors: high temperatures and little rain, followed by heavy rainfall with a drop in temperatures.
Weather
The choice to adopt a “linear regression model” is motivated by the ease of interpretation, which allows for immediate forecasting. Although it has limitations, the model takes into account the most obvious variables that have historically influenced the olive oil market such as: inflation, energy costs, supply and demand.
It is also important to consider that the olive oil market is also influenced by global oil demand and we know that Spain, being the world's largest producer, ultimately significantly influences the price. Then there are the commercial policies of large purchasing groups, not to mention community and international ones, as well as currency fluctuations. These elements can cause even sudden variations in the prices of Italian extra virgin olive oil.
We can also consider the general quality of oils, which can vary from one year to another, and oil stocks which, in any case, for 2025 will still be limited compared to the recent past.
There won't be any then purchasing and selling strategies adopted by operators in the sector, such as millers, wholesalers and bottlers, which could further change the market trend. To take into account these uncertainties, the calculations proposed by “linear regression statistical model” we applied a prudential correction decreasing from 16 to 19,17%.
Conclusion
After these considerations, We can estimate that the average prices of extra virgin olive oil in 2025 will be between €8,40 and €9,70/kg, thus remaining in line with the current market.
Industry operators are advised to adopt a prudent approach, carefully monitoring market conditions and technological innovations, so as to be able to adapt their sales and purchase strategies.
