MARKET UPDATE SPRING 2023
We are a little late getting this information out to you but would like to give an explanation as to what has been going on with the pricing on the products we sell to you and why you have been seeing a price increase.
The current drought in the Mediterranean olive growing region has been said to be the worst in 1000 years. While scientists are working on solutions, the reservoirs are running dry and olive trees are dying of thirst. What used to be considered cyclical crop years (one good yield year followed by a not so good yield year, followed by a good year), we are now seeing lower yields several years in a row.
2022/23 crop year is one of the worst and has resulted in well below normal yields. This is reflected in the pricing. Here is an estimate of price increases by country over last year’s Extra Virgin Olive Oil pricing for just the base cost of the oil (the production of wine for the balsamic is also affected by the drought).
|
22/23 VS 21/22 CROP YEARS |
|
|
|
|
|
COUNTRY |
% OF INCREASE |
|
Spain |
58% |
|
Italy |
46% |
|
Greece |
44% |
|
Tunisia |
36% |
In addition to the increase base pricing for the product, we have also had much higher freight rates and increased labor at our end.
We are still trying to offer you the best products we can at very competitive prices. We keep our margins very slim (too slim according to our controller) and appreciate your on-time payments to help keep us all going.
We will try to keep you updated as we get closer to the new crop. If they don’t get some rain over there soon, we may have a worse year next year. Spring rains are necessary for setting the blossoms for the new crop.
We wish you a great 2023 and thank you for your business.
Your friends at Cibaria International, Inc.
