The Federal Government has been generous in its assistance to the Australian Olive industry through its grants to promote Australian extra virgin olive oil and table olives. In June 2009 it granted a further $200,000 to this cause.
As an Australian producer one can only applaud this, but it seems only the signatories to the Australian Olive Association (AOA) Code of Practice and licencees of the associated brandmark will be the beneficiaries.
A media release from the AOA on 10 June 2009 stated that ‘the funding would be used to develop a campaign to develop a high profile marketing campaign to promote Australian extra virgin olive oil and table olives’. It added that ‘The campaign will also focus on raising trade and consumer awareness of the AOA’s recently introduced Code of Practice’.
8% of Producers have Signed Code
According to the AOA website there are currently 70 signatories to the Code of Practice, only 8% of the estimated 859 producers in Australia (Australian and New Zealand Olive Industry Directory 2010).
In Victoria with 193 producers registered in the ‘Australian and New Zealand Olive Industry Directory 2010’, 22 (11%) are current signatories of the Code of Practice, in New South Wales 16 have signed (8.6%) and South Australia 11 (9%). These low percentages do not reflect claims by State Associations that the majority of producers are signing up to the Code.
The ABC Landline programme on 21 February 2010 reported that ‘three-quarters (of Australian producers) already have (signed the AOA Code of Practice)’. This would mean that there should be approximately 650 signatories on the AOA website.
The AOA publicity surrounding the Code of Practice and Australian Extra Virgin Brand would give the impression that it is the official Australian Standard. It is not. In its own Code of Practice documents covering quality and labelling guidelines there is the statement ‘There is currently no legal Australian standard for the assessment and description of olive oil…………. The AOA currently recommends the quality and type of olive oil be based on IOOC (now International Olive Council IOC) standards such as extra virgin olive oil’. However, it does not adopt the IOC standards testing regime as the basis for certification as extra virgin olive oil.
In comments reported in The Weekly Times on October 21 2009, the AOA President stated ‘We would like the Australian standard to be law ………that would make life easier for the (the ACCC)’. There is no Australian standard and the one referred to must be the AOA Code of Practice. It would not make it easier for the Australian Competition and Consumer Council (ACCC) as this Code has no testing requirements for adulteration. It would make it easier for the AOA as to comply with their Code a licencee has to be a member.
ACCC sets precedent on Australian Standard
The precedent recently created by the ACCC in imposing court enforceable conditions on the sale of three imported brands that they meet IOC standards supports this view that the IOC standard is more than the de facto standard for olive oil on sale in Australia. These conditions in one instance included the requirements:
• Before supplying a batch of edible oil in Australia labelled ‘olive oil’, ‘virgin olive oil’ or ‘extra virgin olive oil’, require the producer or its supplier of the edible oil to provide a certificate of analysis, or equivalent document, that demonstrates compliance of a sample from the applicable batch with the International Olive Council’s trade standard applying to olive oils and olive-pomace oils (IOC standard)
or other equivalent or recognised standard.
• Commission a National Association of Testing Authorities (NATA) - or IOC-accredited laboratory within Australia to test a sample from the applicable batch against the IOC standard or other equivalent or recognised standard.
The only equivalent or recognised international standards are those defined in the Codex Alimentarius and the European Union trade standards. The AOA Code of Practice testing standards do not have any requirement for the tests relating to contamination or adulteration of olive oil and would not therefore be an equivalent standard.
For this reason, and the fact that to have extra virgin olive oil certified under the AOA brand the licencee has to be a member of the AOA, is argued that the AOA is using government money to promote its brand and licencees and not the entire industry.
Cash Cow or Consumer Conscience?
This raises the question as to whether the AOA is developing the self-proclaimed Australian Standard as a cash cow to provide funds for the activities of the association or as a genuine effort to ensure quality product is retailed to consumers.
This exclusivity also poses a problem for supermarkets which the AOA claims has adopted its code of practice as a requirement for olive oils. This may well mean that by excluding Australian olive oils which do not have the AOA certification, but meet the international standards used by the ACCC in its determinations, the supermarkets may be in breach of competition guidelines.
The AOA has another problem which it has created for itself by its pursuit of non-compliant olive oils. It is common knowledge that the barnea variety planted in large numbers by Timbercorp, and others, produces olive oil which does not meet the IOC standards for sterol composition. It is understood that some supermarkets have been approached to vary their standards to allow a higher than IOC standard level of the sterol campesterol, used as an indicator for adulteration with vegetable oils.
Acceding to this request would not only open the market up to non-compliant oils and possible increases in adulteration, but also begs the question as to whether the standards will be varied for suppliers who have large quantities of ‘extra virgin’ olive oil that does not comply with other specifications of the standards. If these other variations are not acceded to, it can be argued that supermarkets will be favouring one brand by making an exception for campesterol.
Open the Code of Practice to all Australian Producers and Retailers
The AOA needs to follow the lead of New Zealand and make two changes to its Code of Practice and Australian Extra Virgin Brand. The first is to open the Code of Practice up to all producers and retailers – this can be done by charging non-members the equivalent of AOA annual membership on top of the licensing fees, as is done by Olives New Zealand (ONZ).
The second is to make compliance with the IOC standard the basic requirement for certification as Australian Extra Virgin, with other additional quality testing as required. Olives New Zealand makes the reference to IOC standards in their guidelines: ‘To qualify for certification olive oil must meet standards required by Olives New Zealand based on chemical and sensory criteria set by the International Olive Council’. However, to date ONZ have apparently only enforced the sensory and selected quality requirements for their ‘Red Dot’ Certification seal.
Government Grants should Benefit Entire Industry
By adopting these two approaches, the AOA will fulfil its claim of promoting Australian extra virgin and ensuring the highest quality product for consumers. It will be up to producers whether they join the AOA for certification or pay the extra fee charged to non-members.
The Federal Government grants would then visibly be benefitting the entire industry, not just the members of the AOA.
Australian Standard should exceed The International Standards
It will also mean that the Australian Standard, when developed, will meet and exceed international standards and it will be up to the producers of non-compliant oils to dispose of them within the accepted framework. Any other approach will be bending the rules in favour of particular enterprises that have planted varieties, or adopted management practices, which produce non-compliant oils.
For olive oils that have been licensed to use the ONZ QualityMark Seal go to
http://www.olivesnz.org.nz/Marketplace.cfm
For those that have signed up to the AOA Code of Practice got to http://www.australianextravirgin.com.au/component/option,com_comprofiler/task,usersList/listid,2/Itemid,61/
Simon Field
21/2/2010
Saturday, February 20, 2010
Tuesday, January 12, 2010
Local Olive Oils Make Market Inroads
Australia and New Zealand are entering the second decade of the new tide of olive oil production and it is a good time to assess how they are faring.
Market penetration
In the mid-nineties both countries imported most of their olive oil requirements with only a few boutique local brands available at the high-end foodstores.
Now, there are around eight Australian brands on the shelves of the main supermarkets. In New Zealand there about four local brands on the main shelves with more in the boutique sections of the large supermarkets. Everywhere there are local brands being sold at farmers’ markets, in delicatessens and upmarket food stores. Many restaurants use regional extra virgin olive oils (EVOO) both on the table and as an ingredient.
Market penetration
In the mid-nineties both countries imported most of their olive oil requirements with only a few boutique local brands available at the high-end foodstores.
Now, there are around eight Australian brands on the shelves of the main supermarkets. In New Zealand there about four local brands on the main shelves with more in the boutique sections of the large supermarkets. Everywhere there are local brands being sold at farmers’ markets, in delicatessens and upmarket food stores. Many restaurants use regional extra virgin olive oils (EVOO) both on the table and as an ingredient.
These inroads into the markets hitherto dominated by imports from Italy, Spain and Greece can be quantified by looking at the trends in olive oil consumption in Australia since 1997. While New Zealand statistics have not been analysed, observation suggests that the trends are similar to the Australian market.
Consumption falls 22% in last three years
The total olive oil consumed in Australia, calculated by adding local production and imports, then subtracting exports, has risen steadily from 17,786 tonnes in 1997/98 to 37,000 tonnes in the 2008/2009 financial year. Growth was 66% from 1997 to 2001 and since then has slowed to 23% over the last 8 years, or about 6% growth a year. Consumption peaked in 2006/2007 at 47,500 tonnes (IOC data), and has fallen from there to 37,000 tonnes last financial year. This represents a fall of 22% over the last 3 years.
Consumption falls 22% in last three years
The total olive oil consumed in Australia, calculated by adding local production and imports, then subtracting exports, has risen steadily from 17,786 tonnes in 1997/98 to 37,000 tonnes in the 2008/2009 financial year. Growth was 66% from 1997 to 2001 and since then has slowed to 23% over the last 8 years, or about 6% growth a year. Consumption peaked in 2006/2007 at 47,500 tonnes (IOC data), and has fallen from there to 37,000 tonnes last financial year. This represents a fall of 22% over the last 3 years.
Extra Virgin consumption increases 35%
While this growth over the last decade is significant, the growth in consumption of virgin olive oil is even more impressive. In 1997/98, 76% of the olive oil consumed in Australia was refined, in 2008/09, this has dropped to 41%. The percentage of olive oil consumed that is virgin – most of which is extra virgin – has increased from 24% in 1997/98 to 59% in 2008/2009. Add to this the growth in olive oil consumption overall, the increase in EVOO consumption has gone from 4,239 tonnes to an estimated 21,000 tonnes during the period being considered.
This is real evidence of the success of the Australian olive oil industry in replacing imports and converting consumers to the use of extra virgin olive oil in preference to the ‘extra light’ and ‘pure olive oils’.
The factors affecting the consumption of olive oil in Australia are complex and include local activities over which producers and retailers have control, and international market fluctuations and trends over which they have little control.
Reasons for increased consumption
It is no coincidence that the world’s highest consumers of olive oil are the countries in which olive oil is produced. This is because the cuisine is built around this healthy ingredient and it is part of the culture. This leads to promotion of olive oil at the local level and from here the word spreads through local markets, produce shops and restaurants. Then converted consumers start purchasing the cheaper local olive oils in the supermarkets. So the first credit must go to the producers who market and sell their products locally with passion.
However, this push is limited in the volume it can dispose of at the relatively high prices expected at the early stage in the industry. The real volumes start to move when the price drops and reaches parity with the price of competing vegetable oils or imported stocks. This has happened in Australia where the prices of many brands of local oil compete with imports. And it is starting to happen in New Zealand with three or four brands.
Again it is the producers who deserve the credit for streamlining the supply-chain and reducing input costs. No promotion campaign would have successfully increased sales to the current level if the product was not affordable.
Overlay the international and national promotion of the increased health benefits of extra virgin olive oils, the taste campaigns and the ‘outing’ of imperfect imported products and one gets the successful campaign that the Australian and New Zealand olive producers have conducted.
However, the evidence of substantial reduction in consumption over the last three years is a concern.
Capturing the other half
Gaining the first 50% of the market is the easiest, getting the rest is harder work. The industry must approach this in two ways: increase overall consumption; and replace more imports. Many will see the increase in the percentage of extra virgin olive consumed as a third push – but this is not necessarily a good tactic as there is demand for refined oils and refining disposes of oil that does not make the virgin classification.
Some of the outside influences that will now limit the growth of the industry are; promotion of cheaper cooking oils, increasing overseas production, and exchange rates.
Olive oil is ranked ninth in the world table of production (USDA 2008), and therefore consumption, of the major commodity vegetable oils. This is mainly due to price and any increase in the price of olive oil will decrease consumption. In Australia, canola is a major oilseed crop and the health benefits of high oleic acid canola oil is being promoted as similar to those of olive oil. It is considerably cheaper on supermarket shelves.
The impact of price of olive oil may be one of the reasons that consumption has declined from 2007/8 to 2008/09 due to the global financial crisis and consequent reduced disposable income.
The level of overseas production of olive oil in general, and specifically extra virgin olive oil, will have a dual impact on sales of Australian and New Zealand olive oils.
First, the world trend to greater production of extra virgin olive oil over the refined oil will continue to reduce the price.
Second, increased world production from trees planted well before the global financial crisis affected consumer spending will also tend to oversupply and lower prices. In Spain we are already seeing significant reduction in exports, and high levels of storage at a time when the predictions are for an increase in production over last year. With the high value of the Australian and New Zealand dollar favouring imports and working against exports, an assault from European Union exporters on the lost market share can be expected.
Some current marketing tactics are short term
The campaign in Australia to expose impure extra virgin olive oil imports has received wide acclaim amongst producers. So much so that the publicity implies that all imported olive oils are imperfect.
While ensuring consumers are getting what they paid for is commendable, the publicity generated is not productive for the following reasons. It is bad marketing to publicly talk down a product – in this case the commodity olive oil - as it tarnishes the reputation of the product in general. Consumers generally do not read beyond the headline unless they have a specific interest and may switch to alternatives such as canola oil.
The constant monitoring for fraud will lift the quality of imports so a more competitive quality product will be on the shelves. It may also lift the price of imports, prompting local producers to lift prices and consequently lose customers to cheaper vegetable oils.
It may also bring a response in the form of restrictive imposts and similar campaigns targeting Australian and New Zealand olive oils from countries which are potential markets, such as Italy. The publicity around the testing and consequent action by the Australian Competition and Consumer Commission on fraudulent oils has generally ignored the reports that one in four Australian brands tested by Modern Olives at the same time failed to meet IOC specifications.
The campaign is a short term tactic as its success will mean that only quality oils are imported, ending the effectiveness of the campaign in discrediting imported olive oils as a ploy to replace them.
The ‘Fresher Tastes Better’ campaign run by the Australian Olive Association to promote its brand is also a short term tactic. Australian olive oils are only fresher than imports for six months of the year – before the Northern Hemisphere harvest comes in. The importers of these fresher oils can piggy-back on the Australian campaign by marketing the incoming oil as more recently harvested and fresher. It also gives a free marketing kick to other Southern Hemisphere producing countries, such as Argentina and South Africa, seeking to sell their new season oils in Australia.
Exchange rates are also important in the affect on the price of imports. The Australian dollar dipped significantly from September to December in 2008, from consistent highs through 2007 (Reserve Bank of Australia data). This almost certainly contributed to the highest consumption recorded in Australia in 2006/2007 and the fall away in the subsequent two years as the cost of importing increased. The Australian dollar is now back to the levels of 2007 and we can expect cheaper imports and downward pressure on the price and consumption of Australian and New Zealand olive oil.
New approaches needed
The substantial inroads the Australian and New Zealand olive industries have made into markets dominated by imports are impressive. The producers of the local oils deserve the credit for this as their passion and influence has spread the word like ripples from multiple stones tossed in a pond.
The slowing of growth in consumption, potential worldwide oversupply and unfavourable exchange rates are going to make the next increment more difficult.
New approaches are needed to increase the consumption of olive oil, whether imported or not, over competing vegetable oils.
The industry should be working towards providing the consumers with better quality at lower prices – price being the ultimate determinant of purchase.
A stronger campaign to promote the health benefits of extra virgin olive oil produced in Australia and New Zealand should give ascendancy over competing oils, especially with our aging population. This will need to be supported by research showing that local oils have greater health benefits than imported oils.
In the future, Australia especially, and New Zealand to a smaller extent, will need to export increasing amounts of olive oil. It is therefore important to consider the reaction of potential customers to campaigns which denigrate all imported oils without distinction or by association.
Is Extra Virgin Olive Oil becoming too precious?
Finally, producers need to consider whether they are giving the impression to consumers that their product is so special that it is to be used sparingly.
An example of this approach of extra virgin olive oil being promoted as too special for general cooking was found on the back label of an Australian brand in a supermarket. Besides describing the oil as ‘viscious’ (presumably very robust!), the label stated ‘This is a table oil too good for cooking – but if you must………’
During a recent visit by the author to a New Zealand farmers market, this approach to selling extra virgin olive oil was also evident. No doubt the relatively high price is the underlying reason for this.
To increase consumption of Australian and New Zealand olive oil we must encourage consumers to use extra virgin olive oil for all cooking – as a dressing, ingredient and cooking medium. It is up to us producers to make sure that it is affordable to do this.
While this growth over the last decade is significant, the growth in consumption of virgin olive oil is even more impressive. In 1997/98, 76% of the olive oil consumed in Australia was refined, in 2008/09, this has dropped to 41%. The percentage of olive oil consumed that is virgin – most of which is extra virgin – has increased from 24% in 1997/98 to 59% in 2008/2009. Add to this the growth in olive oil consumption overall, the increase in EVOO consumption has gone from 4,239 tonnes to an estimated 21,000 tonnes during the period being considered.
This is real evidence of the success of the Australian olive oil industry in replacing imports and converting consumers to the use of extra virgin olive oil in preference to the ‘extra light’ and ‘pure olive oils’.
The factors affecting the consumption of olive oil in Australia are complex and include local activities over which producers and retailers have control, and international market fluctuations and trends over which they have little control.
Reasons for increased consumption
It is no coincidence that the world’s highest consumers of olive oil are the countries in which olive oil is produced. This is because the cuisine is built around this healthy ingredient and it is part of the culture. This leads to promotion of olive oil at the local level and from here the word spreads through local markets, produce shops and restaurants. Then converted consumers start purchasing the cheaper local olive oils in the supermarkets. So the first credit must go to the producers who market and sell their products locally with passion.
However, this push is limited in the volume it can dispose of at the relatively high prices expected at the early stage in the industry. The real volumes start to move when the price drops and reaches parity with the price of competing vegetable oils or imported stocks. This has happened in Australia where the prices of many brands of local oil compete with imports. And it is starting to happen in New Zealand with three or four brands.
Again it is the producers who deserve the credit for streamlining the supply-chain and reducing input costs. No promotion campaign would have successfully increased sales to the current level if the product was not affordable.
Overlay the international and national promotion of the increased health benefits of extra virgin olive oils, the taste campaigns and the ‘outing’ of imperfect imported products and one gets the successful campaign that the Australian and New Zealand olive producers have conducted.
However, the evidence of substantial reduction in consumption over the last three years is a concern.
Capturing the other half
Gaining the first 50% of the market is the easiest, getting the rest is harder work. The industry must approach this in two ways: increase overall consumption; and replace more imports. Many will see the increase in the percentage of extra virgin olive consumed as a third push – but this is not necessarily a good tactic as there is demand for refined oils and refining disposes of oil that does not make the virgin classification.
Some of the outside influences that will now limit the growth of the industry are; promotion of cheaper cooking oils, increasing overseas production, and exchange rates.
Olive oil is ranked ninth in the world table of production (USDA 2008), and therefore consumption, of the major commodity vegetable oils. This is mainly due to price and any increase in the price of olive oil will decrease consumption. In Australia, canola is a major oilseed crop and the health benefits of high oleic acid canola oil is being promoted as similar to those of olive oil. It is considerably cheaper on supermarket shelves.
The impact of price of olive oil may be one of the reasons that consumption has declined from 2007/8 to 2008/09 due to the global financial crisis and consequent reduced disposable income.
The level of overseas production of olive oil in general, and specifically extra virgin olive oil, will have a dual impact on sales of Australian and New Zealand olive oils.
First, the world trend to greater production of extra virgin olive oil over the refined oil will continue to reduce the price.
Second, increased world production from trees planted well before the global financial crisis affected consumer spending will also tend to oversupply and lower prices. In Spain we are already seeing significant reduction in exports, and high levels of storage at a time when the predictions are for an increase in production over last year. With the high value of the Australian and New Zealand dollar favouring imports and working against exports, an assault from European Union exporters on the lost market share can be expected.
Some current marketing tactics are short term
The campaign in Australia to expose impure extra virgin olive oil imports has received wide acclaim amongst producers. So much so that the publicity implies that all imported olive oils are imperfect.
While ensuring consumers are getting what they paid for is commendable, the publicity generated is not productive for the following reasons. It is bad marketing to publicly talk down a product – in this case the commodity olive oil - as it tarnishes the reputation of the product in general. Consumers generally do not read beyond the headline unless they have a specific interest and may switch to alternatives such as canola oil.
The constant monitoring for fraud will lift the quality of imports so a more competitive quality product will be on the shelves. It may also lift the price of imports, prompting local producers to lift prices and consequently lose customers to cheaper vegetable oils.
It may also bring a response in the form of restrictive imposts and similar campaigns targeting Australian and New Zealand olive oils from countries which are potential markets, such as Italy. The publicity around the testing and consequent action by the Australian Competition and Consumer Commission on fraudulent oils has generally ignored the reports that one in four Australian brands tested by Modern Olives at the same time failed to meet IOC specifications.
The campaign is a short term tactic as its success will mean that only quality oils are imported, ending the effectiveness of the campaign in discrediting imported olive oils as a ploy to replace them.
The ‘Fresher Tastes Better’ campaign run by the Australian Olive Association to promote its brand is also a short term tactic. Australian olive oils are only fresher than imports for six months of the year – before the Northern Hemisphere harvest comes in. The importers of these fresher oils can piggy-back on the Australian campaign by marketing the incoming oil as more recently harvested and fresher. It also gives a free marketing kick to other Southern Hemisphere producing countries, such as Argentina and South Africa, seeking to sell their new season oils in Australia.
Exchange rates are also important in the affect on the price of imports. The Australian dollar dipped significantly from September to December in 2008, from consistent highs through 2007 (Reserve Bank of Australia data). This almost certainly contributed to the highest consumption recorded in Australia in 2006/2007 and the fall away in the subsequent two years as the cost of importing increased. The Australian dollar is now back to the levels of 2007 and we can expect cheaper imports and downward pressure on the price and consumption of Australian and New Zealand olive oil.
New approaches needed
The substantial inroads the Australian and New Zealand olive industries have made into markets dominated by imports are impressive. The producers of the local oils deserve the credit for this as their passion and influence has spread the word like ripples from multiple stones tossed in a pond.
The slowing of growth in consumption, potential worldwide oversupply and unfavourable exchange rates are going to make the next increment more difficult.
New approaches are needed to increase the consumption of olive oil, whether imported or not, over competing vegetable oils.
The industry should be working towards providing the consumers with better quality at lower prices – price being the ultimate determinant of purchase.
A stronger campaign to promote the health benefits of extra virgin olive oil produced in Australia and New Zealand should give ascendancy over competing oils, especially with our aging population. This will need to be supported by research showing that local oils have greater health benefits than imported oils.
In the future, Australia especially, and New Zealand to a smaller extent, will need to export increasing amounts of olive oil. It is therefore important to consider the reaction of potential customers to campaigns which denigrate all imported oils without distinction or by association.
Is Extra Virgin Olive Oil becoming too precious?
Finally, producers need to consider whether they are giving the impression to consumers that their product is so special that it is to be used sparingly.
An example of this approach of extra virgin olive oil being promoted as too special for general cooking was found on the back label of an Australian brand in a supermarket. Besides describing the oil as ‘viscious’ (presumably very robust!), the label stated ‘This is a table oil too good for cooking – but if you must………’
During a recent visit by the author to a New Zealand farmers market, this approach to selling extra virgin olive oil was also evident. No doubt the relatively high price is the underlying reason for this.
To increase consumption of Australian and New Zealand olive oil we must encourage consumers to use extra virgin olive oil for all cooking – as a dressing, ingredient and cooking medium. It is up to us producers to make sure that it is affordable to do this.
Wednesday, November 4, 2009
New Zealand Judges Show the Way
Judges in the Olives New Zealand national olive oil awards have shown leadership by not entering their own oils in the competition. This follows controversy in last years awards when the top award went to the oil produced by the head judge.
The move to ensure that judges have no vested interest in the outcome of the competition will remove this distraction from the excellence of the olive oils winning the competition.
In Australia, judges continue to judge in the Australian Olive Oil National Extra Virgin Olive Oil Show when their own oils, or those in which they have an interest, are entered. Of the 26 judges who judged in the competition, 11 had entries in which they have an apparent interest. In the 5 extra virgin olive oil classes, two classes were won by oils which were associated with judges. Three judges had an association with the overall winner of the competition.
The report on the Australian competition acknowledged that ‘some judges were exhibitors, or had an association with an exhibit. To remove any possibility of bias, these judges assessed classes that did not include their oil, and they were at no time in a position to influence the outcome of a class which included their oil’.
It also states that at the conclusion of the judging ‘the twelve gold medal oils were subjected to blind tastings by judges working as one panel’. Three of these gold medal winners were associated with four judges. This implies that all judges judged the oils for the overall winner – unless the judges with an interest in the oils were excluded. This would have indicated to the other judges that the oils of those excluded were in the final 12. Either way the judging would be compromised.
It is notable that some Australian judges who have judged and entered their oil in the past, judged in this year’s competition but did not enter their oils.
Surely it would be much simpler and more ethical for the Australian competition to follow the lead from New Zealand and bar any judges who enter their oils.
Thursday, October 29, 2009
Fresher Sounds Better Too
This year’s winners of the American Oil Chemists’ Society (AOCS) award in Part A, B, and C of the Olive Oil Category are E.A.S. Heraklion in Crete (part A and B) and Chemiservice SAS in Bari, Italy (part C). The award is for member laboratories deemed to be the most accurate in a series of tests set by the Society in a given year.
A visit to the Australian Olive Association (AOA) website industry home page will find a newsflash captioned ‘Modern Olives most accurate lab in the world’. The newsflash goes on to reveal that the lab was named the ‘most accurate lab in the world in 2007-2008’ by the AOCS. Yes – but that was this time last year and the news adorned the AOA website for some months then.
So why is the AOA so keen to promote old news? It could be advertorial, or it could be a perceived need to justify accreditation of a laboratory of arguable independence by the AOA for its Code of Practice quality programme, or it could be to give some weight to the recent ‘independent’ research by Modern Olives that claims 80% of extra virgin olive oils imported into Australia failed a range of tests.
Whatever the reason, it is old news. It is like putting last years award sticker on this year’s olive oil.
In olive oil fresher may taste better, in news, fresher sounds better.
A visit to the Australian Olive Association (AOA) website industry home page will find a newsflash captioned ‘Modern Olives most accurate lab in the world’. The newsflash goes on to reveal that the lab was named the ‘most accurate lab in the world in 2007-2008’ by the AOCS. Yes – but that was this time last year and the news adorned the AOA website for some months then.
So why is the AOA so keen to promote old news? It could be advertorial, or it could be a perceived need to justify accreditation of a laboratory of arguable independence by the AOA for its Code of Practice quality programme, or it could be to give some weight to the recent ‘independent’ research by Modern Olives that claims 80% of extra virgin olive oils imported into Australia failed a range of tests.
Whatever the reason, it is old news. It is like putting last years award sticker on this year’s olive oil.
In olive oil fresher may taste better, in news, fresher sounds better.
Tuesday, October 27, 2009
ACCC Adopts IOC Standard for Olive Oil
In carrying out an investigation into reports that Extra Virgin Olive Oil being sold in Australia was not true to label, the Australian Competition and Consumer Commission (ACCC), used the International Olive Council (IOC) Trade Standard for Olive Oil as the benchmark for testing.
Despite stating that ‘currently there is no mandatory standard for extra virgin olive oil……’ the ACCC set a strong precedent by using the IOC standard and stating ‘The IOC standard defines extra virgin olive oil and sets criteria for purity and quality. While the standard is not mandatory, it is a useful and recognised guide for establishing the essential elements of genuine extra virgin olive oil’.
Effectively the ACCC has adopted the IOC standard for court enforceable undertakings. This could set an important legal precedent in Australia for legal actions involving specifications for olive oil.
The Australian Olive Association (AOA) President, Paul Miller, was reported by the Weekly Times (October 21 2009) as being ‘impressed’ by the ACCC’s action. He was also reported as saying ‘We would like the Australian standard to be law…….that would make life easier for (the ACCC)’.
This is unlikely as the so called 'Australian standard' – a standard developed for the AOA Code of Practice available to AOA members only – falls far short of the requirements for purity and organoleptic (taste) testing in the IOC Trade Standard. Its lack of rigour could create many problems for the ACCC in any legal challenges related to olive oil meeting specification.
It would be far easier if everyone in the Australian Olive Industry adopted the IOC Trade Standards and, to provide regional differentiation, added to them by specifying additional source and quality requirements. The ACCC action probably means that this will be inevitable.
Despite stating that ‘currently there is no mandatory standard for extra virgin olive oil……’ the ACCC set a strong precedent by using the IOC standard and stating ‘The IOC standard defines extra virgin olive oil and sets criteria for purity and quality. While the standard is not mandatory, it is a useful and recognised guide for establishing the essential elements of genuine extra virgin olive oil’.
Effectively the ACCC has adopted the IOC standard for court enforceable undertakings. This could set an important legal precedent in Australia for legal actions involving specifications for olive oil.
The Australian Olive Association (AOA) President, Paul Miller, was reported by the Weekly Times (October 21 2009) as being ‘impressed’ by the ACCC’s action. He was also reported as saying ‘We would like the Australian standard to be law…….that would make life easier for (the ACCC)’.
This is unlikely as the so called 'Australian standard' – a standard developed for the AOA Code of Practice available to AOA members only – falls far short of the requirements for purity and organoleptic (taste) testing in the IOC Trade Standard. Its lack of rigour could create many problems for the ACCC in any legal challenges related to olive oil meeting specification.
It would be far easier if everyone in the Australian Olive Industry adopted the IOC Trade Standards and, to provide regional differentiation, added to them by specifying additional source and quality requirements. The ACCC action probably means that this will be inevitable.
Monday, October 26, 2009
ACCC Only Credible Independent Watchdog
It must be that time of year, an ‘independent’ laboratory has tested imported olive oils again and there are claims that 80% of extra virgin olive oils imported into Australia were not extra virgin.
Last year 'independent' tests commissioned by the Australian Olive Association (AOA) and carried out by the Australian Oils Research Laboratory claimed all the imported olive oils tested were not what they claimed to be. The independence of the AOA, which represents Australian producers, is obviously questionable, as is that of the Australian Oils Research Laboratory whose spokesperson was reported to have said on ABC Rural Report (Report from the Riverina, 29 May 2009) that he believes the (International Olive Council, IOC) Standards are too restrictive and find fault in Australian oils that are merely different – and in his opinion the best. Hardly a statement from an independent watchdog.
This year, again with uncanny timing to coincide with the AOA annual bash in Canberra, another set of tests have been released. An ABC Rural Report on 22 October states ‘A study has found that more than 80 per cent of imported "extra virgin" olive oils are falsely labelled. Lisa Rowntree, from the Australian Olive Association, which represents olive growers, says the tests were done in an independent laboratory near Geelong, and the problem makes it difficult for the local industry to compete’.
But Paul Berryman, from the Australian Olive Oil Association (AOOA), which represents olive oil importers, says very few imported extra virgin oils were found to be impure and the test was done to discredit importers. ‘Now they are obviously just deciding that the best way to market their product is to discredit their opposition’.
It may well be that Mr Berryman is right. The independent laboratory near Geelong is Modern Olives which, as a wholly owned subsidiary of Boundary Bend, is far from independent. Boundary Bend claims to be Australia’s largest producer of extra virgin olive oil and would directly benefit from a crackdown on imports. It is also highly unlikely that all imported extra virgin olive oil was tested so a claim that 80% were found to be falsely labelled is misleading.
This tactic should also worry Australian producers as the ‘independent testing’, apparently endorsed by the AOA, could also be directed at Australian brands and used to discredit them to gain market advantage.
Fortunately for the Australian Olive Industry, which includes both local producers and importers, the Australian Competition and Consumer Commission (ACCC) has recently conducted an independent investigation. Testing a selection of imported and locally produced oils, labelled extra virgin, against the International Olive Council standards, only three samples, all imported, were found not to be extra virgin.
Interestingly, in using the IOC standard as the benchmark for quality and purity, the ACCC has adopted a standard which is far more stringent than the AOA standard for its Australian Extra Virgin Brand which does not require any of the tests for purity.
It would also be interesting to know whether the ‘independent’ laboratory from Geelong, Modern Olives, tested the full range of Australian ‘extra virgin olive oils’ and refined olive oils for compliance with the IOC specifications for sterol composition. Modern Olives, through its nursery operations, has been a major supplier of the Barnea variety which research has shown has a high level of campesterol causing much of the oil produced by this variety to fall outside IOC specifications for extra virgin. Boundary Bend, in buying the Timbercorp assets, has also become the owner of groves which have substantial plantings of Barnea.
Again, it seems to be a case of adopting the IOC standards when it is convenient and saying they are too restrictive when inconvenient - ‘do as I say, not as I do’.
The Australian Olive Industry representative organisations – The AOA and the Australian Olive Oil Association (AOOA) – should agree to a regime of independent testing through the ACCC to ensure that all olive oil sold in Australia meets IOC specification. This is the only way to put an end to the ‘them and us’ public brawling which harms the consumer perception of all olive oil – locally produced and imported.
Sunday, October 18, 2009
Attempts to Change International Olive Oil Standards Stall
The attempts by Australia to change the Codex Alimentarius ‘Standard for Olive Oils and Olive Pomace Oils’ seem to have stalled. The Australian delegation has been leading the charge to amend the standards to allow higher levels of linolenic acid in olive oils to accommodate apparent variations in local growing conditions. Recently, the arguments for the proposed amendments have been extended to include higher campesterol levels, mainly to accommodate the high levels exhibited by the Barnea variety which has been extensively planted in Australia by large investment groves.
The higher than specification levels of linolenic acid and campesterol preclude the export of ‘outlier’ olive oils to the European Community, USA and other countries that are signatories to the Codex Alimentarius Standard for International Trade.
The levels of linolenic acid and campesterol in olive oils are important in detecting contamination or adulteration with vegetable oils.
In response to a report submitted by the Codex Committee on Fats and Oils to the thirty-second session of the Joint FAO/WHO standards programme of the Codex Alimentarius Commission, the Committee agreed to go back a step and circulate two alternative proposals for a footnote to the level of linolenic acid in the standards which would allow higher levels as long as three other tests were undertaken. One of these three tests would be that the campesterol level would need to be lower than 3.5% (normal allowable 4.0%) of total sterol composition. It then determined that if no agreement could be reached at the next session, the Committee would recommend the discontinuation of work on the level of linolenic acid.
Given the arguments, including those from the European Community, put forward by other delegations against the proposed changes to the standards, it is unlikely that proposed changes to campesterol levels will make any progress in the foreseeable future.
This creates a problem for those enterprises that have large volumes of olive oil from the Barnea variety in Australia which is high in campesterol. There is not enough low campesterol olive oil available locally to blend the level down to be within specification. The oil cannot be exported to countries that are signatories to Codex, and it cannot be refined as even after refining the campesterol level is likely to be out of specification for refined olive oil.
It would appear that the only option for unloading this high campesterol oil, which does not comply with international standards for olive oil, is to sell it on the local market as extra virgin olive oil as sanctioned within the Australian Olive Association Extra Virgin Olive Oil specifications.
The implication of this for other producers in Australia is that the prices for EVOO will be forced down as the large volume of non-compliant oil is sold off locally. There are also implications for New Zealand producers as standards for olive oil in Australia and New Zealand are set by Food Standards Australia and New Zealand (FSANZ). The apparent acceptance of the sale of high campesterol oil by FSANZ may mean that cheap high campesterol oil may overflow into the New Zealand market from Australia.
Simon Field
Olive Business
The higher than specification levels of linolenic acid and campesterol preclude the export of ‘outlier’ olive oils to the European Community, USA and other countries that are signatories to the Codex Alimentarius Standard for International Trade.
The levels of linolenic acid and campesterol in olive oils are important in detecting contamination or adulteration with vegetable oils.
In response to a report submitted by the Codex Committee on Fats and Oils to the thirty-second session of the Joint FAO/WHO standards programme of the Codex Alimentarius Commission, the Committee agreed to go back a step and circulate two alternative proposals for a footnote to the level of linolenic acid in the standards which would allow higher levels as long as three other tests were undertaken. One of these three tests would be that the campesterol level would need to be lower than 3.5% (normal allowable 4.0%) of total sterol composition. It then determined that if no agreement could be reached at the next session, the Committee would recommend the discontinuation of work on the level of linolenic acid.
Given the arguments, including those from the European Community, put forward by other delegations against the proposed changes to the standards, it is unlikely that proposed changes to campesterol levels will make any progress in the foreseeable future.
This creates a problem for those enterprises that have large volumes of olive oil from the Barnea variety in Australia which is high in campesterol. There is not enough low campesterol olive oil available locally to blend the level down to be within specification. The oil cannot be exported to countries that are signatories to Codex, and it cannot be refined as even after refining the campesterol level is likely to be out of specification for refined olive oil.
It would appear that the only option for unloading this high campesterol oil, which does not comply with international standards for olive oil, is to sell it on the local market as extra virgin olive oil as sanctioned within the Australian Olive Association Extra Virgin Olive Oil specifications.
The implication of this for other producers in Australia is that the prices for EVOO will be forced down as the large volume of non-compliant oil is sold off locally. There are also implications for New Zealand producers as standards for olive oil in Australia and New Zealand are set by Food Standards Australia and New Zealand (FSANZ). The apparent acceptance of the sale of high campesterol oil by FSANZ may mean that cheap high campesterol oil may overflow into the New Zealand market from Australia.
Simon Field
Olive Business
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