Europe Braces for Higher Olive Oil Prices Amid Drought and Wildfires

Europe's olive oil producers are bracing for another price surge as extreme heat and drought damage their crops. The Guardian reports that olive groves have been hit by wildfires in Greece, Italy, and Portugal, with even those that escaped direct fire damage affected by wind-blown ash and poor air quality. The extreme heat has also increased pest and disease pressure, intensified severe storms, and reduced olive fruit size, further weighing on yields.

Although global olive oil prices had eased after a sharp rally two years ago, driven by strong demand, hot and dry weather, and widespread pest and disease outbreaks, the average price of a one-liter bottle of extra virgin olive oil in UK stores remains above £7 (about UAH 422) and has started rising again in recent months.

France's vegetable growers' association Légumes de France estimates that thousands of tons of produce worth tens of millions of euros have already been lost, including carrots, garlic, and onions. Spain's Ministry of Agriculture forecasts the country's 2026/27 grain harvest at 18.5 mln tons, down from 24 mln tons last season.

The European Commission has also lowered its crop forecasts, projecting sunflower production 7% below the previous harvest, grain corn 6% lower, and potato and soybean output 3% below earlier expectations.