Friday, March 11, 2011

Australian Olive Oil Market Progress Report

The most recent figures on world trade in olive oil reveal some interesting facts about the Australian market.

While the data for 2009/10 is provisional and those for 2010/11 are estimates, the proportion of Australian olive oil consumed in the local Australian market has changed by just 3
% over the last 4 years.

Previous analysis by Olive Business has shown that sales of local extra virgin olive oil have made substantial gains ( However, when taken as a percentage of overall olive oil consumption it seems little has changed since the major gains in 2007/8 when the local oils consumed rose from 14% to 23%.

Analysis of the export data also reveals that over the past three
years the percentage of local production exported has not increased.

There could be many reasons for this apparent stagnation of market share. For example, we may be seeing a relative decline in olive oil consumption when compared with other vegetable oils as another Olive Business analysis shows. (

It is notable that there is little or no financial or market modelling of olive oil with competing products providing background for decision making on standards and promotional activities. An investment in models would help predict the impact of price fluctuations, exchange rates, reduced imports, changes in labelling and consumer reaction. This modelling should cover all market segments.

The Australian industry would be well advised to critically examine the complex interactions in the marketplace and reconsider the current marketing strategies. Some of the issues to be considered are:

  1. Why is there little growth in consumption of olive oil in Australia over the last five years?
  2. Why has the proportion of Australian olive oil consumed locally seemingly reached a plateau?
  3. Is price a barrier to consumption when compared with other vegetable oils?
  4. Has the negative publicity about low quality olive oils had an impact on sales overall?
  5. Has the consumption of extra virgin olive oil reached a plateau?
  6. Is there the opportunity to make inroads into the lower quality/price segment of the olive oil market?
  7. Has current marketing strategy achieved as much as it can and is it time for change?