Wednesday, November 4, 2009
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
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
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
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’.
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.
Sunday, October 18, 2009
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.
Sunday, August 30, 2009
During two-day seminars in Blenheim (South Island) and Napier (south east of the North Island) I had the pleasure of meeting the enthusiastic producers, distributors and retailers of these regions and tasting their new season olive oils. The purpose of the seminars was to provide taste training, evaluation of olive oils and blending - all from a market perspective.
Data for the size of the New Zealand market, and the local markets in each location, was scratchy. However, data purchased by Olive Business from the New Zealand statistical office shows that imports of olive oil were around 4,000 tonnes a year and local production was estimated to be around 400 tonnes. Approximately 30-40% of imports are extra virgin olive oil (EVOO), add the local production to this and we get an estimate of 1500 tonnes of EVOO consumed every year in New Zealand. This is more than three times current local production, showing that many New Zealanders are already ‘educated’ in the use of extra virgin olive oil. This makes the marketing task easier – shifting usage to New Zealand product as opposed to getting consumers to use a new product.
To Market, to Market
The first day of the seminars examined this market environment and participants tasted their own oils with special emphasis on style and flavour. Each oil was also given a commercial assessment and some interesting trends emerged. Most of the olive oils from both locations were assessed as medium or robust. There were few delicate oils and even those were on the medium side of delicate. The oils from particular varietals were generally similar. In both locations there were olive oils that had well differentiated, even outstanding, flavour profiles – but these were the exception.
The olive oils available were mostly of Italian varietal origin – frantoio, leccino – with some picual, koreneiki, barnea and picholene. The Spanish varieties (picual and nevadillo blanco) did not exhibit the aromatic tropical fruit characteristics expected and given that consumers are used to this style for imported oils there is an opportunity for development in this area. The absence of a range of complex delicate oils usually associated with later harvesting creates a further opportunity.
In Hastings imported olive oils off the local supermarket shelf were slipped into the blind tasting to test the ‘all imported oils are faulty’ slogan. No rancidity was detected – however the floral-ripe tropical fruit aromas of the Spanish oils, imparted presumably by the Picual, Hojiblanca and Picudo varieties in the blends, disconcerted some of the tasters.
The price difference between the imported and local brands in the supermarket is closing but still significant. In some of the smaller supermarkets the local brands were on the bottom shelf, a sure sign that they were not moving, and the packaging was mainly in 250ml bottles, a sure sign that the product is expensive.
Given all these considerations – the limitations of local production, the style of the oils, price points to compete with imports and consumer preference – seminar participants worked in teams to develop a market brief and blend oils to meet the brief.
This exercise was most revealing. The openness of the participants and the determination to take the industry from its current adolescence to maturity was most productive. The briefs developed were varied, practical and all could be implemented. The process revealed the valuable collective knowledge of the teams. Gaps in the range of oils available were identified and the advantage from a taste and volume perspective of blending became apparent.
Visits to a number of groves, including some of the largest, revealed the horticultural limitations that define productive capacity and oil characteristics. Early frost, pruning, disease, harvesting, and processing method and capacity affect the oil profile as much as the variety. Most accepted there was work to be done in these areas to achieve optimal efficiency and reduction of end price.
In the grove with (l-r) Bob Marshall, Shona Thompson, Rachael Speedy and Chris Crompton-Smith
It was acknowledged that price was both the determinant of profitability for the producer and the most important consideration with consumers. The presence of retailers brought reality to the discussions with the simple message that the price expectation of producers was too high and there needed to be adjustments to the supply chain to bring the retail price down within consumer expectation set by imported brands.
One way of reducing the price, obtaining more delicate oils and insuring against crop failure is to retain a proportion of oils from previous seasons. Generally the oils tasted were robust enough to do this. This also enabled ‘back-blending’ to reduce price and preserve particular traits for consistency. Blending with refined oils and other vegetable oils were also discussed to produce products which will compete directly with the imported ‘pure’ and light olive oils in supermarkets.
Differentiation in markets for the olive oils for the two regions can be achieved through Denomination of Origin (PDO) certification and ‘tested to international standard’ labelling. The testing to international standard would provide a range of chemical data to further define the health attributes of the fatty acid profile and anti-oxidants of the olive oils. The polyphenol levels from the analysis will provide data for blending for longer shelf-life.
The ‘tested to international standard’ branding would also position the complying oils ahead of the existing ‘ONZ Certified Extra Virgin’ mark which has a far less rigorous testing regime.
The ‘girls’ teams in Blenheim differentiating their oils through blending
To round off the regional advantages for marketing, both regions have well established wine and tourism industries on which to build the olive oil profile. The food culture is well developed and in most restaurants at least two local extra virgin olive oils are used. Visits to retailers showed some reluctance to stock and promote local oils because of price. There is an adage which says ‘if you cannot win in the local market you won’t win in other markets’. The intention expressed by participants is to work on this through collection and analysis of market data and more cooperation along the supply-chain.
On a lighter note, while enjoying delicious fish and chips on the sunny harbourside in Napier, we noticed an offering of ‘green salad drizzled with Kiwi Oil’. Was this a new product to compete with Emu Oil we asked the waitress? With the confidence of youth she told us it was the oil extracted from the Kiwi fruit. We smiled when we realised that the oil is in fact a locally produced olive oil called ‘Kiwi’. There is work to be done with foodservice too.
Harnessing the Assets
The Marlborough/Nelson and Hawkes Bay olive industry in New Zealand, as reflected by participants in the seminars, is determined and talented. Their olive oils are good quality and market success will come through differentiation through taste, price and innovative marketing. The teamwork during the seminars shows that there is the cohesion, resourcefulness and increasing knowledge to make this happen.
These are the assets of the industry which when harnessed will bring its success.
Align all this with the already established local food and wine culture attracting tourism and the worldwide profile of the wines – Marlborough/Nelson and Hawkes Bay will be Paradise regained.
Thank you to all who showed typical Kiwi hospitality and endless humour, especially Phyllis and Mark Heard of Awatere River Extra Virgin Olive Oil who took the initiative to organise the seminars, and Rachael Speedy and Nigel Macintosh of Paul Holmes Extra Virgin Olive Oil who promoted the Hawkes Bay seminar. Thanks also to Andrew and Delyth Taylor of Olive Culture who took me to many groves in Hawkes Bay and taught me a lot about pruning and how to drive up frighteningly steep hills.
Wednesday, June 17, 2009
Monday, May 25, 2009
Wednesday, April 29, 2009
The import prices (cv) for packaged virgin olive oils into Australia during March declined for the first time in 4 months while the bulk price continued to decline.
The average price for packaged virgin olive oils dropped to 8.5% to $5.63/litre and bulk virgin olive oil dropped 5% to $4.79/litre.
The falling prices can be expected to continue with an improving Australian dollar, weak prices in Europe and the global financial crisis slowing the movement of stock.
The lowering of import prices will continue to put downward pressure on prices of Australian olive oil.
Source: Australian Bureau of Statistics
The graph below shows a steep downward trend in producer prices for extra virgin olive oil in the European markets which set the prices for international trade.
The upside is that the reduction in price of olive oil will encourage consumers to increase consumption. Another positive is that with lower production of competing vegetable oils through application of less fertiliser, and sustained consumption driven by more fried food being consumed in China and palm oil being used to generate electricity, the price of vegetable oils may well increase. This could mean olive oil increasing its share of the international edible oil market.
The futures exchange in Jaen Spain, Sociedad Rectora del Mercado du Futuros del Aceite del Oliva SA, Jaen (MFAO) shows that there is little confidence in prices increasing over the next year with quotes as low as €1585 per tonne. This price is well below the price of production and converts to €1.44/litre (approximately AU$2.88/litre).
Non-compliance of Australian olive oils
The survey of Australian Olive Oil Cultivars to Determine Compliance with International Standards (RIRDC Publication no: 08/167) October 2008 (Survey on Compliance) casts doubt over the compliance of varietal Australian olive oils with the International Olive Council International Trade Standards.
The research was funded by the Australian Government and industry funds from the Australian Olive Association (AOA) and is available at www.rirdc.gov.au .
The survey reports that of 143 samples of olive oil tested over 2 years, 87 did not comply with one or more of the chemical tests required for extra virgin olive oil. The tests are directed at assuring quality and detecting adulteration with refined olive oils and other vegetable oils.
Of 143 samples of olive oil tested, 87 did not comply with one or more chemical tests for extra virgin olive oil
According to the Australian Extra Virgin Brand (the Brand) website ‘Australian olive oils are almost entirely extra virgin olive oil.’ (www.australianextravirgin.com.au)
This assertion will be difficult to substantiate with supporting data as not all Australian olive oils in the market undergo the full range of International Olive Oil Council (IOC) quality, purity and sensory tests required for classification as extra virgin olive oil to International Trade Standard.
In fact, so confident is the AOA that Brand olive oils are ‘almost entirely’ extra virgin, that it does not require the full range of tests to comply with international standards. Or could it be that the tests are not required for fear an embarrassing number of olive oils do not meet the extra virgin criteria. The survey on compliance shows that this is quite possible.
Or could it be that the tests are not required for fear an embarrassing number of olive oils do not meet the extra virgin criteria. The survey on compliance shows that this is quite possible.
Australia is vocal in the international olive oil standards scene in its attempts to broaden the Codex Alimentarius trade standards for olive oils. Australian delegates regularly attend the Codex Committee on Fats and Oils, the most recent was held in Sabah in February. On the agenda was “The proposed draft amendment to the Standard for Olive Oils and Olive Pomace Oils: Linolenic Acid Level”.
Australia features prominently in the ‘general comments’ of the agenda papers. Under discussion are; the linolenic acid limit of 1.0%, and campesterol levels in olive oils specified by the Codex Standard.
Australian delegates argue that there are regional differences in the chemical analysis shown by authentic olive oils which should be allowed for in the Standard. For example the papers state ’that a significant proportion of Australian olive oil samples do not meet the 1.0% limit for linolenic acid’. This comes from research presented by Australia that showed from crop years 2002, 2003 and 2004, of 754 samples of olive oil tested from all states, 4.2% were outside the standard.
The papers point out that during the testing period, Australia accounted for 0.07% of world production and no more than 0.05% of world exports. This begs the question of the futility of investing valuable industry money in trying to change an international standard which affects 4.2% of Australian production – when there is ample (95.8%) oil available to blend the high level down.
Perhaps more significantly, Australia also argues against a reduction to 3.5% in the allowable level of less than 4% campesterol as a percentage of total sterols in olive oil. Australia asserts that ‘Data on sterol content reveal that levels for campesterol are consistently high in a significant proportion of authentic Australian olive oils’. Campesterol level is one of the indicators used to detect adulteration with vegetable oils such as sunflower and canola.
Non-compliance of the Barnea Variety
The Survey on Compliance shows that the mean value of campesterol for the tested samples of the variety Barnea is 4.5%.
Technically, these oils cannot be called extra virgin – they may be authentic, but not extra virgin.
Technically, these oils cannot be called extra virgin – they may be authentic, but not extra virgin. The definition of extra virgin olive oil is ‘virgin olive oil which has a free acidity, expressed as oleic acid, of not more than 0.8 grams per 100 grams, and other characteristics of which correspond to those fixed for the category in this standard’. The ‘other characteristics’ include the regime of chemical testing.
If an olive oil does not comply with the chemical standards, it cannot be called extra virgin. In fact it cannot be called olive oil, according to the IOC International Trade Standards. And it cannot be refined as the chemical standards for sterols in refined olive oils are very similar to extra virgin and a level of campesterol above 4.0% of total sterols is unacceptable.
Herein lies a problem for the Australian industry. Many varietal oils with small variations from specification which do not comply can be blended with compliant oils to result in an oil that fits the standards. However, the report identifies the variety Barnea as one with high campesterol levels, an average across samples tested of 4.5%, where the standard is 4.0%. This means that to blend this oil into specification, at least an equal volume of an olive oil with a campesterol of 3.5% or less is required.
According to the website www.boundarybend.com, Barnea is the most common variety planted in Australia, representing 41% of plantings.
We know that several large investment groves in Victoria and South Australia planted large numbers of the Barnea olive variety. The report ‘Bigger is Better at Boort’ in the Weekly Times (April 15 2009) states that of the 997,000 trees planted at the Timbercorp Boort Estate olive grove in Central Victoria, more than half are Barnea. Boundary Bend also reports that Barnea is a variety planted in the large northern Victoria groves under its management.
Coincidentally, the Survey on Compliance reports that ‘Central Victoria was the highest in campesterol. This is of concern as the majority of cv Barnea trees are grown in Central Victoria’. The implication of this is that there is a large quantity of olive oil being generated which is not extra virgin and will need to be blended with at least an equal quantity of other compliant oils.
The implication of this is that there is a large quantity of olive oil being generated which is not extra virgin and will need to be blended with an equal quantity of other compliant oils.
If we assume that 41% of Australia’s olive oil producing trees are the variety Barnea, and that Australian production in 2008 was the estimated 12,000 tonnes (AOA), as much as 4920 tonnes of olive oil produced from Barnea with high campesterol levels may not comply with international standards for extra virgin olive oil, and cannot be labelled as such.
The solution to the problem is to blend. At best this will take another 4920 tonnes of olive oil with lower than 3.5% campesterol. For any producer with a large proportion of Barnea, this could mean buying in substantial quantities of oil for blending. It will also place a premium price on olive oils with lower campesterol levels – an important incentive to have one’s olive oils tested for sterol composition.
It will also place a premium price on olive oils with lower campesterol levels – an important incentive to have one’s olive oils tested for sterol composition.
If then add the 4% of olive oils that have high linolenic acid levels, and take account of all the olive oils that are downgraded for sensory faults and high free fatty acid or peroxide levels, we may be looking at over 50% of Australian varietal production not being extra virgin by international standards.
we may be looking at over 50% of Australian varietal production not being extra virgin by international standards.
Are smaller producers being disadvantaged?
We need more accurate data and less unfounded assertion if we are to manage the Australian olive industry effectively. Testing of olive oils requiring classification should be carried out to Codex Standards (which have been adopted by the IOC) at independent laboratories and the data collated and made publicly available. We can then make informed decisions on blending and the marketing of our products.
By establishing a Code of Practice and/or a trade standard that does not require full testing to IOC Standard, the Australian Olive Association may be favouring the larger producers who have substantial quantities of varieties that may produce non-compliant oil. At the same time, having a standard to accommodate local interests which is less rigorous than international standard risks the entire industry being discredited by international buyers.
By establishing a Code of Practice and/or a trade standard that does not require full testing to IOC Standard, the Australian Olive Association may be favouring the larger producers who have substantial quantities of varieties that may produce non-compliant oil.
The ‘Australian Standards’ may also disadvantage those that ‘have done the right thing’ by planting varieties that produce oil to international standard. And who should be getting a premium for their bulk oil if it is in high demand for blending.
The ‘Extra Virgin Olive Oil’ classification is an international brand mark with standards set by the International Olive Council. It is not logical to state that Australia produces almost entirely extra virgin olive oil, and then argues in international forums that trade standards should be eased to allow ‘a significant proportion’ of currently non-complying olive oils to comply with extra virgin classification.
It is not logical to state that Australia produces almost entirely extra virgin olive oil, and then argues in international forums that trade standards should be eased to allow ‘a significant proportion’ of currently non-complying olive oils to comply with extra virgin classification.
Survey short on options
The Survey on Compliance is a useful scientific analysis. However, it is surprisingly political coming from an independent government research laboratory. The only solution it seems to recommend is the changing of international standards, an unlikely political achievement given Australia’s insignificance by volume in the world market. It offers little to help producers in overcoming the problem while this attempt to change world standards takes its inevitable slow course.
The process of changing world standards will be a protracted one. It will involve:
1. Australia developing a new standard through Standards Australia with a lengthy consultation process.
2. Adoption of the Australian standard by Food Standard Australia and New Zealand (FSANZ).
3. Garnering support from other producing countries.
4. Persuading Codex Alimentarius to change the international trade standard.
5. Persuading the International Olive Council to replace the existing International Trade Standard with the new standard.
6. Allowing a moratorium period for producers to comply with the new trade standard.
In the meantime how does Australia dispose of potentially increasing volumes of non-complaint oils as groves planted with offending varieties reach maturity?
There are no suggestions of rooting out the offending trees that produce non-compliant oil – as was suggested with the large plantations of Manzanilla. There are no suggestions on ways horticultural practice could mitigate the problem. There are no estimates of the requirements for blending, or suggestions that more widespread testing of oils should take place.
The Survey does not canvass the impact of opening up the standard to the substantial amounts of non-complying oil produced overseas, thereby increasing then worldwide volume of extra virgin olive oil and lowering prices. The implication of softening the standards in the detection of adulteration with vegetable oils is not discussed.
The Survey does not canvass the impact of opening up the standard to the substantial amounts of non-complying oil produced overseas thereby increasing then worldwide volume of extra virgin olive oil and lowering prices
If Australia is to act unilaterally and develop its own standard, it runs the risk of discrediting its olive oil product in the eyes of major importers, and at the same time opens Australia up to the importation of products that comply with local standards but are outside international standards.
The singular approach of The Survey’s recommendations appears to be doing the AOA’s bidding and potentially legitimising the sale of substantial quantities of non-compliant Australian olive oil.
This singularity is reinforced by the statement ‘it may cost exporters large amounts of money to send oil outside the country, only to have it rejected as adulterated’. It could also say – ‘to avoid incurring large costs from having oil rejected as adulterated, we recommend that all oils for export are tested to international standard prior to despatch’.
‘to avoid incurring large costs from having oil rejected as adulterated, we recommend that all oils for export are tested to international standard prior to despatch’.
And –‘Oil with exceptional characteristics such as organoleptic quality and oxidative capacity is being blended with inferior oil to achieve compliance with inappropriate trade standards’. Which could also have said – ‘blending is common practice to improve the quality and shelf-life of olive oil and to ensure compliance’.
blending is common practice to improve the quality and shelf-life of olive oil and to ensure compliance.
There are many legal and economic implications of the use of the descriptor ‘extra virgin olive oil’ when an olive oil does not comply with standards. It is not good enough to say that there is no Australian Standard, and little better to introduce a standard that ignores key chemical specifications established to detect adulteration.
Australia should simply adopt the International Trade Standard promulgated by the IOC and then get on with solving the problem of non-compliant oils. Money being spent on delegations to Codex in the arguably futile and certainly protracted attempt to substantially change standards would be better spent in making it possible for producers to fully test their oils.
The Government should be establishing an independent monitoring and compliance programme not influenced by those that may be affected by planting the wrong varieties.
The alternative is to allow the sale of olive oils that are not extra virgin, thereby undermining all the rhetoric from the AOA claiming Australia produces almost entirely ‘extra virgin olive oil’.
Thursday, April 16, 2009
Timbercorp owns the largest olive groves in Australia and claims to produce around 40% of Australian production of olive oil. Boundary Bend Ltd, owner of the Cobram Estate brand of olive oil, is Timbercorp's 'strategic alliance partner' for its olive projects.
In its 2008 annual report Timbercorp recorded 6,530 hectares of olives under management which produced almost 4.6 million litres of extra virgin olive oil. An oil yield of 15.41%. Oil prices achieved were between $4.53 and $4.71 per litre ($4.92-$5.12/kg). With the 2009 harvest under way, the predicted harvest is 5.5 million litres, almost 20% up on 2008.
The statement cites the cause of the credit squeeze as the unsatisfactory offers for its timber plantations which it is attempting to sell to retire debt. As far as its horticultural assets are concerned, it states that expressions of interest have been received but no formal offer has been made to date. It does not state whether the olive assets are the subject of an expression of interest.
Analysts predict the increased consumption of fried foods in Asian countries and continuing demand for palm oil for electricity generation will mean a supply shortage in the coming year. This may increase the demand and price for other vegetable oils such as canola and sunflower oil.
This could be good news for olive oil producers which produce around 4% of the world's edible oils. Olive oil is usually around double the price of oils such as canola and sales should benefit if the price differential is reduced.
Seen as a healthier vegetable oil than competing oils, consumers may respond to the closing of prices by electing to buy the healthier product for slightly more.
Wednesday, April 15, 2009
This has led some supermarkets to review their private labels with a view to expansion and possible rebranding.
The impact of this move on the Australian olive industry could be downward pressure on producer brand prices and consequently lower producer prices for olive oil. Producer margins for the supply of olive oil through a tender process for household brands are generally lower than returns from sales of branded products.
Saturday, March 28, 2009
Analysing the search terms used through search engines has become an important tool in gauging the interest in in products and the effect of media campaigns.
Google analytics have tracked the interest in various search permutations of olive oil since 2004 with interesting results. The interest is measured on a scale of 0-100. The worldwide search for 'olive oil' remained flat around the 80 mark until mid-2008 and since then has climbed steadily to around 95.
The searches are also divided into categories; for olive oil the most important categories are Food and Drink (50-75%), Health (10-25%) and Beauty and Personal Care (10-25%). The percentage indicates the perceptions of uses according to the searchers. With the emphasis on the health aspects of olive oil, it is surprising that this category does not rate higher.
The search for 'extra virgin olive oil' followed the same pattern with a score of 60 from 2004 with a steady rise from early 2008 to the current 90. Significantly, the Health category only recorded 0-10% interest, less than for olive oil. This could be interpreted as the consumer not getting the message about the health attributes of extra virgin olive oil.
The analysis of the regional interest shown in extra virgin over the last 5 years has Singapore top with a score of 100, USA second with 98 and Australia third with 74. New Zealand ranks number 8 with a score of 54.
Australian and New Zealand Searches
In Australia, the search for 'extra virgin olive oil' showed a steady decline from when it first registered with adequate traffic in late 2004 with a score of 80. The steady decline continued to late 2007 when it hit a low of just above 20. During 2008, traffic increased with a spike reaching 100 at the time of the publicity surrounding supermarket olive oils in October. Since then interest has abated to just above 60, 20 below the 2004 level.
Analysis of the searches by State shows the highest interest is in Victoria with a rating of 100, then New South Wales at 80 and Queensland with 57. The other States did not rate - probably a reflection of their smaller populations.
New Zealanders don't search enough for 'extra virgin olive oil' to register a score. 'Olive oil' does register and, following wild fluctuations in 2004 and 2005, has settled to a steady 50. There is a spike to 70 in early 2009, probably related to coverage given to the judging of the 2008 Olives NZ olive oil competition. The main interest comes from Wellington with a score of 100, then Auckland 95, Taranaki 86 and Canterbury 81.
The internet search analytics are a useful tool to gauge the impact of promotions and industry publicity - both positive and negative. Having lifted the interest back to 2004 levels, the challenge for the Australian industry is to commit the resources to sustain the renewed interest. For New Zealand, the challenge is to generate more traffic searching for olive oil.
Thursday, March 19, 2009
The average bulk virgin olive oil decreased from the January figure to $5.04/litre, down 20%, and down 6% on the November 2008 figure.
After three years of steady decline from a high of around 4 Euros/kg in January 2005, the price of extra virgin olive oil has started to even out around 2 Euros/kg, or approximately $4.40/litre.
The increase in the import price and the reduction in value of the Australian dollar relative to that of importing countries in Europe and the US should favour an increase in sales of local product in Australia and an increase in exports. However, this positive outlook may be dampened by the general reduction in retail spending and a switch to cheaper cooking oils.
Thursday, March 5, 2009
Prices of virgin olive oil imported into Australia continue their upward trend according to Australian Bureau of Statistics data.
The imported price of packaged virgin olive oil reached $5.78/litre, an increase of $1.24/ litre over December and 13% above previous the highest price this financial year in August. The price of bulk virgin olive oil followed the trend and remained higher than packaged olive oil.
The price hike is probably caused by a number of factors, including the lower Australian $ exchange rate with the Euro and the switch from older olive oils being sold off in the last four months of 2008 to new season oils from the Northern Hemisphere coming on the market early in 2009.
Imported olive oil customs value (cv) in Australian $ per litre
Virgin olive oil packaged
Virgin olive oil bulk
Source: Australian Bureau of Statistics data
Monday, February 23, 2009
We have read in at least three recent publications (Australian Extra Virgin – Production Facts and Figures (www.australianextravirgin.com.au , The Olive Grower and Processor, Weekly Times Now) that Australians consume approximately 44,000 tonnes of extra virgin olive oil (EVOO) a year. This is not correct.
According to the Australian Bureau of Statistics import data, the imports of olive oil for the financial year ending in June 2008 were as follows:
Virgin olive oil in bulk (often referred to as extra virgin olive oil) 2,220 tonnes
Total virgin olive oil 15,093 tonnes
Olive oil, excluding virgin, packaged (referred to as refined olive oil) 14,931 tonnes
Olive oil, excluding virgin, bulk (referred to as refined olive oil) 1,867 tonnes
Total olive oil excluding virgin 16,798 tonnes
Note: These refined oils are usually described as ‘pure’ and ‘extra light’ on supermarket shelves.
Olive oil and their fractions including blends 333 tonnes
(referred to as olive pomace oil and blends with other vegetable oils)
The approximate figure of 44,000 tonnes is the total import figure added to the estimated Australian production of 12,000 tonnes giving a total consumption figure of 44,224 tonnes.
If we assume that Australian Olive Association assertion that ‘Australian olive oils are almost entirely extra virgin olive oil’, is correct, we can take 90% of Australian production as EVOO giving Australian consumption of extra virgin olive oil of around 26,000 tonnes, less exports.
Exports of virgin olive oil (which includes re-exported imports) for the financial year ending in June 2008 were 2556 tonnes.
A reasonable estimate of Australian consumption of EVOO is therefore 23,500 tonnes a year, 20,500 tonnes less that that claimed on the Australian Extra Virgin Brand website.
The website also claims that about 35% of Australian extra virgin produced in
Official Australian olive oil production reported by the International Olive Council for 2006/2007, which would be exported in 2007/2008, is 9,000 tonnes. This gives an export percentage closer to 28% (less when re-exports are taken into account).
Friday, February 13, 2009
Testing Laboratory Cost/test single sample
1NSW DPI Olive Oil Testing Service
Modern Olives Laboratory
Fatty acid composition and trans fatty acid content
Absorbency in ultra violet
Sterol composition Erythrodiol + uvaol
111.75(tri acyl glycerides)
(tri acyl glycerides)
Total cost of Individual tests
International trade package cost
TOTAL COST OF TESTING
Cost per litre 1000 litres
Cost per litre 10,000 litres
Cost per litre 100,000 litres
Turn around (including delivery time to lab)
10 working days
7 working days
10 working days
1 International Olive Oil Council accredited for chemical and organoleptic tests
2 International Olive Oil Council accredited for chemical tests
* Converted to Australian $ at $0.50 to 1.00 EuroTaking the package costs as the most cost effective, the lowest cost of testing for an enterprise that produces 1000 litres of one brand of olive oil a year is 37c per 500ml bottle at Chemiservices in Italy. This comes down to 4c for a production of 10,000 litres of a single brand and 1/3c for 100,000 litres. It may be reasonably argued that the impost of 37c on small producers producing 1000 litres will reduce profit margins, but this argument is more difficult to justify for the 4c or less per bottle for larger volumes. These costs will be further reduced by submitting multiple samples if producers cooperate in submitting samples for testing. Given the importance of assuring the quality of both Australian and New Zealand extra virgin olive oils to consumers, and to provide certified analysis in the case of disputes, it is difficult to understand why the custodians of quality standards do not simply adopt the IOC international trade standard as the basis of their quality branding. Comparison of testing results between laboratories To get an idea on the accuracy of testing from the three laboratories compared above, Olive Business sent a sample of the same refined olive oil for sterol composition testing at the three laboratories at the same time. The results are given in the table below. The percentage variation in the testing is concerning, especially when a sterol may be close to the IOC standard limit. The variation could have one laboratory showing the oil inside the standard with another showing it does not meet the standard. This reinforces the importance of testing samples for monitoring at two different independent IOC accredited laboratories.
Sterol Composition of refined olive as a % of total sterols
Refined Batch 2
Refined Batch 2
Refined Batch 2
|Beta-sitosterol+delta-5 avenasterol +delta-5-23 stigmastadienol + clerosterol + sitostanol +delta 5-24 stigmastadienol|| |