FRESNO, CALIF. — Quality issues may lessen the iron grip European olive oil processors have in the United States, according to a recent market analysis published by Rabobank’s Food & Agribusiness Research and Advisory Group. The research group predicts the U.S. olive oil industry will gain a 5% share of the American olive oil market in the next five years. European olive oil imports currently account for 99% of the U.S. market.
The share increase for domestic olive oil is based on the establishment of stricter U.S. quality labeling standards and increasing consumer education on quality. Olive oil consumption in the United States has grown at an annual rate of nearly 6% over the last two decades.
“Research shows that U.S. olive oil producers are providing a far superior product,” said Karen Halliburton Barber, assistant vice-president and senior agricultural analyst with Rabobank. “As consumers become educated and begin to appreciate this distinction in quality, demand for U.S. brands will grow.”
A University of California at Davis study of extra virgin olive oil sold in California found that nearly three-fourths of samples tested of the top-selling import brands did not meet international quality standards. Many of the European brands tested were found to be subpar and blended with cheaper oils. The study found that U.S. and Australian samples met the quality standards.
The U.S. olive oil industry is attempting to strengthen quality standards for extra virgin olive oil through the passage of a marketing order. The order may eventually require imported olive oil to meet the same higher quality standards as domestic olive oil. Such legislation would likely impact imports significantly, presenting opportunities for domestic olive oil brands to gain shelf space prominence, according to Rabobank.