Olive oil prices in Canada are coming down, for now

CITYnews halifax / By Sonia Aslam

It’s one of the most popular grocery store items that’s likely sitting in your kitchen right now and after leaving Canadian customers with sticker shock, the price of olive oil is coming down, albeit slowly.

Statistics Canada says month over month, the cost per litre is getting cheaper. In July it was averaging $16.68 and in August it was listed at $16.40.

“Over the last year in the region of Canada, olive oil, one litre saw the largest increase in price at $3.51. Prices for olive oil, one litre, saw the largest per cent increase at 27.23 per cent,” StatCan explained.

University of Guelph food economist Michael von Massow tells 1130 NewsRadio that there was significant drought around the Mediterranean last year, but the region finally got some rain, which helped crops.

“Now, we’ve gone to a much more normal production year … in Greece, Spain, other countries had maybe not exceptional yields but yields that are much closer to normal. Simple supply and demand. As supply comes back up, we see prices come down.”

He says last year, Spain — the world’s largest producer of olive oil — saw its production drop by more than 60 per cent and we won’t know about next year’s crop for several months.

“We’ve seen small price decreases recently. I would expect that over the course of the fall, we’ll see olive oil prices come down substantially,” he said.

Von Massow is predicting it’ll drop by roughly $3, which isn’t quite to levels seen in 2023.

“It depends specifically on what kind of olive oil you’re buying, the quality, the quantity, but I don’t think we’ll get back down to the numbers we saw last year.”

Statistics Canada says in August 2023, one litre cost $12.89.

While it is good news that the price is coming down, von Massow is clear — it comes with a warning.

“It’s not to say that when we talk again in the spring or in a year from now we won’t be saying, ‘Well, it was dry in the Mediterranean again and we saw yields come down.’ My expectation is in this current climate environment that we will see greater variability,” he said.

“We’re much more likely to see big increases and then decreases where, if you look historically, we’ve seen bumps up and down in various years, but relatively consistent levels of food price inflation. I think we’re going to see much more variation going forward because this year Spain got enough rain. Next year might not get enough rain.

“That sort of variability is the reality for the food system going forward.”

Von Massow says climate change is making it harder to predict how the food supply will be affected because the swings in weather are sudden and often severe.

He adds this price drop is across the board and isn’t specific to whether you buy olive oil in liquid form or a spray can.

Von Massow says soybean and canola yields are also better than before, so prices for those oils and products should also be coming down.