Trade Economics of Olives and Olive Oil: Data and Issues Sacramento - PowerPoint PPT Presentation

Trade Economics of Olives and Olive Oil: Data and Issues Sacramento Valley Olive Day Orland, July 6, 2018 Daniel A. Sumner and William A. Matthews University of California Agricultural Issues Center

Motivation, Orientation, and Overview • International agricultural trade is in the headlines these days and concerns abound…what does trade turmoil mean for farms? • Economics underlie almost every decision in agriculture and international trade affects both costs and returns • Import access to the US affects farm input costs, and competition in domestic markets. Access for US exports affects output demand and prices for most California farm products. • We know more open markets have been broadly good for economic growth and incomes over the past 70 years, but governments are often motivated to limit market access and impose import taxes • Olives are different from most California commodities in that exports are minimal, while import competition is robust

Index of US Olive Acres, Yield and Total Production, 1998-2017 2.5 1998: Acres = 35,300 Yield = 2.55 tons/acre 2.0 Production= 90,000 tons 1.5 1.0 2017: Acres = 36,000 - 0.5 Bearing Acres Yield = 5.34 tons/acre - Total Production Production= 192,300 tons - Yields per Acre 0.0 2017 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Source: USDA ERS

Utilization of US Produced Olives, 2007-2017 120 Volume of Olive (1,000 short tons) Canned Crushed for Oil 100 • • 80 60 40 20 0 2007 2009 2011 2013 2015 2017 Source: USDA ERS

Source of Available Supply of Olive Oil Marketed in US Imports US Production 800 I • • 31 35 Olive Oil Supply (million pounds) 22 13 700 7 600 500 400 729 710 696 687 300 591 200 100 0 2009 2011 2013 2015 2017 Source: USDA ERS

2017 US Olive Oil Imports by Source Argentina Total $1.44 billion $63.9 Turkey ($millions) $63.8 Tunisia EU $1,192.0 $61.9 Chile $33.4 Rest of World $31.5 Source: US Dept of Commerce

2017 US Olive Oil Imports by Olive Oil Grade Refined $331 Total $1.44 billion ($millions) Virgin $36 Extra Virgin $1,048 Source: US Dept of Commerce

Rest of World $21.6 2017 US Extra Turkey $23.2 Virgin Olive Oil Imports by Source Chile Total $1.05 billion $33.2 ($ million) Tunisia EU $864.5 $44.4 Argentina $61.2 Source: US Dept of Commerce

2017 US Extra Virgin Olive Oil Imports From EU by Country Italy $447.7 Total $864.5 million Rest of EU ($ million) $3.3 Greece $39.2 Spain $374.3 Source: US Dept of Commerce

2017 US EU $3.3 Olive Oil Exports by Destination Rest of World Country $6.5 Total $28.2 million ($ million) Japan $0.6 Taiwan $1.8 Canada $11.0 Mexico $5.0 Source: US Dept of Commerce

Farm trade news has mostly about lost exports • Almost all the news about farm trade this year has been about the treat of trade policy turmoil has been causing for exports • This makes sense because most major US commodities are export dependent and the countries targeted for new US trade barriers are the largest import markets • Commodities are dairy products, beef, pork, tree nuts, wine, fresh vegetables as well corn and soybeans are highly vulnerable • The threats and actions change every few days and sometimes solutions seem close, but as of this week, new US tariffs are in place and retaliation has begun • There may be some good result envisioned but for agriculture the costs are already real.

Source of Available Supply of Table Olives Marketed in US 400 Volume of Table Olives (million pounds) 350 US Production Imports • • 343 300 250 234 234 232 225 200 212 180 150 138 100 109 77 50 0 2008/09 2010/11 2012/13 2014/15 2016/17 Source: USDA ERS

US Table Olive Import Value and Volume, 2008-2017 $425 180 Volume of Imports (1,000 MTs) $415 I- - Value of Imports ($1 million) 170 Value Volume (MTs) $405 $395 160 $385 $375 150 $365 140 $355 $345 130 $335 $325 120 2017 2008 2009 2010 2011 2012 2013 2014 2015 2016 Source: US Dept of Commerce

Unit Value of US Table Olive Imports, 2008-2017 $3,200 Unit Value per Metric Ton $3,000 $2,800 $2,600 $2,400 $2,200 $2,000 2017 2008 2009 2010 2011 2012 2013 2014 2015 2016 Source: US Dept of Commerce

2017 US Table Olive Imports by Source Total $387 million ($ million) EU $337.3 Morocco $24.8 Egypt $7.0 Turkey $5.5 Peru $4.2 Rest of World $8.4 Source: US Dept of Commerce

2017 US Table Olive Imports From EU by Country Greece $145.8 Total $382.2 million ($ million) Italy $21.7 Portugal Spain $204.8 $6.9 Rest of EU $3.1 Source: US Dept of Commerce

2017 U.S. Table Olive Imports by Product Tariff Line Whole Stuffed Description Green Olives, Total $387 million Containter less All other trariff than 8KG $102 ($million) Lines $126 Broken or sliced salad Sliced Not- style Green Green Olives, Oives, Canned $61 Whole Container less Pitted Not- than 8KG $21 Green Whole Not Olives, Not Source: US Dept Pitted Green Canned $43 of Commerce Oives $35

2017 US Table Olive Exports by Destination Rest of World $2.8 Total $12.4 million Canada $4.2 ($ million) EU $0.7 Mexico $0.7 Korea $0.9 Japan $2.2 China $0.9 Source: US Dept of Commerce

2016/17 Global Table Olive Production by Rest of Spain 490.8 World 548.3 Source Total 2.7 million metric tons Morocco 100.0 (1,000 MTs) Egypt 500.0 Syria 190.0 Greece 204.0 Algeria Turkey 433.0 234.0 Source: International Olive Council

2016 Global Table Olive Rest of Exports by Source World 116 Total 868.4 thousand tons (1,000 tons) Turkey 57 Spain 315 Egypt 67 Argentina 67 Morocco 99 Greece 146 Source: GTA Database

Thank you aic.ucdavis.edu