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“Australian olive oil market analysis from its main producer’s point of view” is the title of a masterclass that will give Leandro Ravetti, Technical Director at Boundary Bend Ltd., as part of the WOOE
In anticipation of his keynote speech, Leandro Ravetti offers an exclusive interview for the WOOE
Before such a masterclass, scheduled for the oncoming 2nd of March at 2pm, Leandro Ravetti, Technical Director at Boundary Bend, the largest Australian olive oil producing company, gives us some of the keys to the sector.
Over the last few years, we have noticed a cutback in the Australian olive oil imports. Is this fact due to a contraction of the market or to a shift towards local product?
Since the local industry started to produce olive oil, the Australian olive oil consumption has doubled in the last fifteen years: from consuming less than one liter per capita in 2001 to more than two liters per person according to provisional 2015 figures. Australia has the highest per capita olive oil consumption outside the Mediterranean Basin. The growth in consumption was handled by an imports’ rise –in particular until 2008/2009–, and then by an increase of local product availability on the market. It is also interesting to highlight that over the last ten years the Australian market has registered a significant growth in extra virgin olive oil consumption: i.e. EVOOs are consumed instead of blends of refined olive oils and fractionated products instead of bulk olive oil. Such facts meant not only the increase of the overall amount of consumed olive oil, but also the average value per liter.
In addition, I believe that we should not isolate the Australian market from the global olive oil situation. Over the last five or six years, the strong decrease of the global olive oil production and the subsequent stocks’ reduction have led to a sharp rise in the value of imported products. Add to that the fall in the value of Australian dollar, and we have the recipe for explaining why imports did not maintain the rate of growth that they have achieved during previous years.
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Boundary Bend is the largest olive oil producing and exporting company in Australia, could you explain what the company’s main international markets are?
Boundary Bend produces and sells almost exclusively extra virgin olive oils. 85 % of what it is produced; it is sold as a fractionated product. The company’s two major brands are Cobram Estate and Red Island. These brands sell only Australian extra virgin olive oil in a packaging of dark-colored glass bottles of 250ml to one liter. The company also manufactures bigger containers, which are mainly cans of 3 and 4 liters.
Furthermore, Boundary Bend supplies Australian extra virgin olive oil to several supermarket chains (the EVOO is sold as these supermarkets’ own brand). Extra virgin olive oils from Cobram Estate and Red Island are listed in more than 1.500 stores in Australia, and they are also exported to different countries, such as New Zealand, the United States, Canada, Hong Kong and Singapore. Nevertheless, the deliberate choice of our products by the Australian consumer has resulted in a production that is primarily commercialized in the domestic market (75 % of our production). The major markets for our bulk olive oil exports are the United States, Italy, New Zealand, and Spain, in that order.
What is your view on the EU market, given that it is the first producer, consumer and exporter worldwide? Has your company considered the possibility of selling your products here?
There is no doubt that the European market is very appealing for two reasons: its size and the level of product knowledge and recognition by consumers. However, regarding the packaging, tariff rates for imports of Australian olive oil in the UE constitute an almost prohibitive burden, which makes it very difficult to compete with local product. Moreover, we strongly promote the importance of quality, and the traceability and freshness of extra virgin olive oil; so that the consumer can experience the virtues and benefits of this great product.
Therefore, from a commercial point of view, we believe that it does not seem logical to try to sell Australian olive oil to the Spanish consumer. Spanish consumers have access to excellent extra virgin olive oils, which are produced within a few kilometers from their homes, and they can even know who the growers are. And that is precisely why –in order to expand in the US market– Boundary Bend has recently decided to commence with operations in California; where we already have a high-tech oil mill and our first olive grove, following an intensive model, quite similar to what we do in Australia.
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