The future looks grim for New Zealand's budding olive oil industry as world supply starts to exceed demand.
A glut of olive oil is predicted in the next five years, as Mediterranean countries improve production techniques and new producer countries emerge, says a report, Olives in New Zealand.
The report's author, Hawkes
Bay Olive Association chairman Richard Lysnar, says that in New Zealand alone, an estimated production of 350,000 litres this year will jump to 2.5 million litres in 2003, despite slowing worldwide demand, as other types of vegetable oils cash in on healthy eating claims.
Our existing export markets will become more competitive and producers face a tough market domestically because imported olive oil is cheaper. Supermarkets are able to buy imported brands for less than a third of the cost domestic growers can produce it for, and specialty shops are too small a market to have much of an impact, it says.
To combat the difficulties, the domestic industry should be more competitive and play to its strengths by encouraging New Zealanders to develop a taste for virgin olive oil, Mr Lysnar says.
About three-quarters of the olive oil sold in New Zealand is "pure" or refined, but domestic growers, who lack a refinery, produce mainly virgin oil.
"To compete, olive oil producers must convert some market share from pure olive oil into virgin olive oil and reduce the price of their olive oil."
- NZPA
