Will Super-High Density Olives Go The Way Of The "Ripe" Olive?
This piece is scheduled to run in the Capital Press in the Fall of 2006The feedback keeps coming in regarding my column of 9/1/2006, “Super High density Olive No Panacea.” One reader commented that the market for California table olives is “dead” while another mentioned that olive oil was really the only place for olive growers to go. Both of these points, which are strangely interrelated, are valid. However, both require some qualification.
Although they are still the best industrial “ripe” style olives in the world. The market for California “ripe” olives is both shrinking and mutating. In general, the ‘ripe” olive is a commodity and the California “ripe” olive exists at the higher end of the price spectrum.
The food service market for California “ripe” olives, especially the pizza and sandwich segments, has shrunk because this market has a high threshold for mediocrity and is highly price sensitive, while the household market has shrunk because of changing eating habits and growing consumer awareness of other styles of cured olives.
From a grower’s perspective, the price paid by the packers of California “ripe” olives has remained virtually unchanged since the 1940s. At the same time, there are currently only two major packers of “ripe” olives, so it is hard to see that price increasing much. The question remains, will super-high density olive production for olive oil provide a better return for growers? My answer is, probably not.
I hope that time proves me wrong, but my gut feeling is that the olive oil produced from the super-high density system will become much like the California “ripe” olive. It will be a great product but it will be difficult to differentiate and it will evolve into a commodity. It is also hard for me to see the price to growers increasing over time. In fact, with the paucity of major marketers in the state, super-high density growers will have very little leverage when it comes to price negotiations. In fact they will be hard-pressed to take anything more than they can get.
Finally, while growers of table olives can also produce oil from their fruit, super-high density olives are not really suitable for any use other than oil production. In addition, the jury is still out on whether or not they perform that well for oil production in this state. The number of 40 gallons per ton that is used as the standard yield for super-high density olives seems highly optimistic given the fact that most of the real numbers that have come in from the field tend to fall between 28 and 36 gallons per ton.
Although there have been a good many reasonable excuses for why the olives are not hitting 40 gallons per ton, even the most reasonable excuses don’t pay bills. The fact of the matter is that machine harvesting in the late fall and early winter will always be a tricky proposition in California. Table olive growers may have to depend on a shrinking pool of foreign hand-labor to harvest their crop, but short yields can be equally financially devastating to super-high density olive growers. Once again, my advice is simple; proceed with caution.
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posted by Brian J. Kenny @ 6:20 AM
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