Present in nearly 70 countries with iconic brands like Carbonell, Maestros de Hojiblanca, or Bertolli, Deoleo celebrates with optimism the recovery of consumption and commercialization of olive oil, both in Spain and in international markets. After several years marked by poor harvests, caused by adverse weather conditions and a complex geopolitical context, the so-called liquid gold is beginning to regain some stability. This is reflected in the latest CPI data, which shows a 44% drop in prices.
Cristóbal Valdés joined Deoleo in October to take on the role of CEO, just at that moment of calm, succeeding Ignacio Silva, who continues as the president of the world's largest olive oil company. This is his first interview since taking on the role, and he welcomes Actualidad Económica at the Alcolea factory in Córdoba, which is celebrating its 50th anniversary this year. "I am very excited and with a huge commitment to drive the company's development," says this native of Bilbao, who also celebrates the good results of the previous year, with a turnover of 996 million euros and 143 million liters of oil sold.
It has arrived just when the storm has cleared...
Indeed. These have been very difficult years for the sector, but now I believe we are facing a great opportunity mainly because we have just experienced two historically very bad harvests in Spain that conditioned both the price and the commercialization of the product.
Exactly, in recent years we have seen how the price of olive oil has skyrocketed, what impact has it had on consumption?
The impact has been significant. We have experienced two consecutive campaigns with very low production, something unprecedented. It was inevitable that this situation would be reflected throughout the value chain, ultimately reaching consumers, for whom it has been a difficult reality to accept. In a more stable context, these fluctuations would not be as frequent or generate as much controversy. However, this year the harvest is estimated at 1.4 million tons, which represents a significant increase compared to last year. Furthermore, the climatic conditions for the next campaign are very favorable, giving us a perspective of stability. Lower prices and a stable outlook facilitate the commercialization of olive oil worldwide. This stability allows all sector agents to sell better, which is very positive for us.
During these years of sharp price increases, has there been a shift towards other oils, such as sunflower oil or other alternatives?
There has been some displacement, but I find it surprisingly positive that, despite the price increase, a very important part of consumers has maintained their loyalty to olive oil. What has changed is a greater awareness of how production costs influence the final price, as well as a growing interest in aspects such as quality and sustainability, which has reinforced confidence in the product. Outside of Spain, although there has been a slight decrease in consumption due to price increases, the reduction has been much less than expected, demonstrating the enormous potential of those markets. Therefore, price stabilization is already allowing us to regain consumers both in Spain and internationally, facing a promising scenario to continue bringing the qualities of olive oil to new audiences.
The latest CPI data shows a decrease of almost 44% in prices. Has olive oil consumption already recovered?
In the first months of the year, consumption has shown a significant recovery, especially in Spain, where the trend seems to be on the rise. This improvement, combined with more favorable agricultural campaigns and price stabilization, benefits all sector players, and consumers are already beginning to notice this recovery. Therefore, I foresee an optimistic future for the industry, both in the domestic and international markets, which will help reduce the controversies typical of periods of high volatility.
Besides climate and prices, what other factors are driving the growth in olive oil consumption?
The intrinsic quality of the product is key. Olive oil is undoubtedly the healthiest fat for both cooking and household use. More and more consumers around the world, not only in Mediterranean cultures but also in markets like Northern Europe, North America, Latin America, and Asia, recognize and value its benefits, even when prices are higher. This underlying trend continues to grow. Therefore, price stabilization, along with the increasing attractiveness of olive oil for consumers, places us in a very favorable position. Additionally, there is a growing awareness of the importance of transparency, traceability, and sustainability throughout the value chain. This collective commitment will allow us to face very positive years for the sector.
Has the government's decision to maintain the reduced VAT of 4% for olive oil contributed to the recovery of consumption?
Yes, undoubtedly, all measures taken to mitigate the impact of the inflation crisis on the final price for consumers have been very positive, and maintaining the reduced 4% VAT for olive oil has been one of the most important. Now, in this new stage, it is crucial that all value chain actors work together to clearly and solidly convey to consumers worldwide the essential values of olive oil: quality, sustainability, and health benefits. In this way, we will all benefit, from producers to packagers, and of course, consumers.
Will prices rise again in the short term?
It is a very volatile product, but I do not expect such sharp increases as those of recent years to be repeated in the short term. On the contrary, the most likely and reasonable trend is towards greater price stability.
What measures have you implemented and what lessons have you learned to minimize the impact if another price crisis occurs?
Although phenomena such as drought or poor harvests cannot be completely avoided, we actively work on sustainability to reduce volatility in the value chain. Since 2019, our program involves 88 oil mills in six countries, over 60,000 farmers, and 330,000 hectares under responsible management. Olive oil is driving change, leading the transformation towards more sustainable production.
Are you concerned about the rise of private label brands in the sector?
The fundamental aspect is the value that the product quality brings and the strength of historical olive oil brands. Many, like Carbonell, have a century-old legacy and offer quality and unique attributes that clearly differentiate them from private label brands. Of course, private label brands must also earn consumer trust by demonstrating their own qualities and advantages.
You are present in 69 markets. How does a global brand adapt to such diverse audiences, especially in countries where olive oil is not part of the culinary tradition?
Our goal is to lead the global marketing of olive oil and bring Mediterranean culture to every corner. Although our brands share global values, we adapt communication to the particularities of each country. Today, we reach over 88 million consumers through programs specifically designed for each market.
Does the relationship with olive oil vary greatly between countries?
It varies greatly. In Mediterranean areas like Spain, Italy, or Greece, consumption is deeply rooted. In contrast, in markets like North America, Northern Europe, or Asia, usage is still lower, but recognition of its benefits is rapidly growing. In those countries, we focus on introducing the product and promoting its use beyond dressing, highlighting its versatility and nutritional value.
How do you win over a consumer in a country unfamiliar with our culture to introduce them to olive oil and not perceive it as a luxury item?
First, it is essential to understand the lifestyle and culinary habits of the target country. From there, we showcase the benefits of olive oil, both for health and in cooking, adapting it to their habits and ways of cooking. Additionally, we convey the values of the Mediterranean lifestyle, which combines gastronomy, enjoyment, and family moments, to emotionally connect with these new consumers.
How does that translate into practice? What really works in these markets?
Emotional connection works very well. It is surprising to see how in such different parts of the world, when the approach is right, the consumer discovers and appreciates olive oil. For example, in the United States, we have seen Drew Barrymore talk about our Bertolli oil on television, and the adaptation in India, Australia, and Scandinavia shows how our brands fit into local customs. Having local teams that convey that close message is essential. At Deoleo, we emphasize the pleasure of cooking and sharing, not just health. I am confident that consumption will continue to grow globally, and by working together from Spain, we can lead this expansion.
Which markets currently offer the most growth opportunities for Deoleo?
We want to continue strengthening our leadership in our historical markets, such as Spain and Italy. Additionally, we aim to grow in markets with great potential, where olive oil consumption is increasing, and the unique values of our brands are increasingly appreciated, especially North America and Northern Europe, as well as Asia, the Far East, and Latin America.
Given your strong presence in North America, are you concerned about the tariffs that Donald Trump wants to impose?
Regarding tariffs in the United States, the ideal scenario would be for American consumers to access olive oil under the best possible conditions. It is important to consider that over 95% of the olive oil consumed in that country is produced outside, so high tariffs could hinder access to this product. Nevertheless, we remain firmly committed to the North American market. We will continue to strengthen our communication policies, commercialization, and closeness to consumers to keep growing and ensure that olive oil remains part of their daily lives.
Have you taken any preventive measures to mitigate the impact if they are implemented?
The tariff policy in the United States is not yet defined or definitively confirmed. Therefore, we will adapt to the situation once the final decision is made. We have experienced a similar situation six years ago when a 25% tariff was applied, which had a significant impact on the sector, although the current circumstances are different. We reiterate that we prefer tariffs not to be imposed, but in any case, we will continue to strengthen our presence in the U.S. market, promoting the qualities of olive oil and maintaining our priority focus on the United States.
Is Deoleo open to growing through acquisitions?Deoleo has clear growth plans and does not rule out any options. Our main goal is to continue strengthening our position as a global leader through recognized and high-value brands. Therefore, we maintain an open perspective regarding possible acquisitions that allow us to continue growing.
What challenges is the sector and the company currently facing?
Regarding the company, we are in a very favorable moment to implement our new strategic plan. Our focus is on growing and strengthening our presence in key markets such as Spain, Italy, North America, Northern Europe, and Asia. To achieve this, we aim to strengthen our iconic brands, increase commercial investment, and advance product innovation.
What actions are you taking to ensure that the company is prepared for this growth?
We are incorporating artificial intelligence to optimize the supply chain and reinforcing the training of our teams. Sustainability is a transversal axis. The sector is experiencing a more favorable moment, and it is crucial to promote quality, traceability, and sustainability policies.