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With the spiraling economy and resurfacing troubles in Spain, Spaniards and olive producers of Spain alike are hit hard.  The downed economy causing headaches to olive producers and everyone else linked within the sphere of Spanish influence doesn’t come to anyone’s surprise, but the recent light in “fraud” or “no fraud” debate in questionable olive oil products in Spain has caused the market for advil to sky rocket.  The Spanish government stating the issue of concern as due to the “lack of proper storage” created an outbursts of complaints claiming the guilty suspect is due to fraudulent oils, a similar case we’ve seen last summer in Italy…..

Andalusia under fire for blaming olive oil preservation, not fraud (ootimes)
Tough time for Spain’s olive oil stock market (ootimes)

Note:
-I was unaware of MFAO (olive oil futures, of Spain) until just recently, (due to it being a local market in Spain) but truthfully anyone could have foreseen this outcome once you put a few equations together and analyse the data like a baby figures out how to use a sfork.  Though once the olive oil exchange market is outfitted in the bigger public market (and perfected away from “scandals” and crushing competitions) perhaps maybe then could we efficiently forecast how much olive oils could yield to our investments?  As you can see I’m still a little skeptical to this approach despite personally being far more openly welcoming and unbiased to any and all ideas.  However, with the growth of US and Aussie domestic producers, combined with the expansion of olive oil imports across the world, perhaps this is another vehicle to jump on next time we have a few cash to play? (or if BofA, Cisco, GE, or Microsoft start to look ugly)

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One of the more ongoing issues on relying on products undercutting local growers.  More prevalent in Europe and a visionary condition if the US hadn’t made strides to support local farmers and producers.  Although with the worsening economy, alternatives in cutting down on expenses may instead lead to unwanted revolutionary trend…

Here, French locals (FDSEA to be exact) are infuriated by their chain grocery stores purchasing cheaper products from outside the country, while more and more of the local growers are forced to find alternatives to compensate for their losses (“farmers market”).  While the compensations are a short-term relief, they’ve already begun taking drastic measures like protesting for stringent import tax, or in this case raiding incoming Spainsh produce trucks “Mad Max“ style(here).  Although it’s important to note this surge of reprisal was resulted from the after-effect caused by the E Coli. situation Spain was heavily blamed for (and heavily lost $), but later rebutted due to the virulent bacteria later established to have originated from a German farm.(here!)

Perhaps a bit too broad a topic, however Spain’s relaxed labour regulations have to be factored into the same reason Spain is leading the global olive oil industry…Basically this cause and effect is a no win situation for anyone (except for maybe the Spanish government and buyers of Spanish products); Spanish farmers work under cheap labor barely making a living, importing countries hurt their own domestic growers, and competitors are withered away like a decomposing food (no, not like Mc*onald*s) or transforming into one, “Nightrider”.

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The European Food Safety Authority (EFSA – the equivalent to our USDA) have been spear heading their campaign on cracking down false (mostly health related) labeling and claims which topped a whole array of food including extra virgin olive oils. So far within the past 3 years, they’ve already assessed near 3k of the +4.6k submissions with rejections made mostly due to lack of supporting evidence for the claims. In other words, sellers would have to shift their focus to product niche, and think twice before claiming widely known accepted data. Although within the 2,758 claims already evaluated, we won’t know exactly how much of it is directly towards olive oils, or whether the remaining 1,548 accounts will be as well. One thing for sure is, we now have one more thing to keep in mind when buying imports. Not to worry, EFSA, European Commission is known to do a better job than…..!

More here

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Relatively correlating to the damage the economy is having within the Spanish olive oil industry.  Add that to the overproduction and astonishing price that undercuts all their international competitors.

Spain Goes Beyond Extra Virgin (ootimes)