Spanish olive oil hit by US ports, no alternative routes seen By Reuters

MADRID (Reuters) – Olive oil exporters in Spain, the world’s biggest producer, have warned there are no viable alternative routes to the lucrative U.S. market amid a strike in Eastern and U.S. Gulf Coast ports.

Spain’s association of olive oil producers and exporters Asoliva said the strike that began on October 1 would affect exports, without quantifying the impact.

WHY IT’S IMPORTANT

Spain became the largest exporter of olive oil to the United States last year, overtaking Italy, as shipments reached 180,000 metric tons, or nearly a third of the 480,000 tons consumed there, according to Asoliva.

Spanish olive oil exports to the U.S. doubled in value between January and July from a year ago to 693 million euros ($765 million), official Spanish data showed, accounting for 6 percent of Spain’s total exports to that country. Meanwhile, consumption of bottled oil in Spain fell due to higher prices.

KEY QUOTE

“If the strike continues, it will be a problem … we don’t think it’s viable to go through the Panama Canal or Argentina, or by air,” said Asoliva director Rafael Pico.

Spanish cooperative Dcoop told Reuters it had looked at possible shipments to less affected ports, but that did not appear to be an option.

“We hope (the strike) will be called off soon,” he said, adding that he had increased shipments to the United States in recent weeks to build up stocks ahead of the strike.

CONTEXT

American consumers bought more Spanish olive oil, even though at an average of 8.81 euros per kilogram it is more expensive than its Italian counterpart.

Some US analysts warned that perishables such as fruit, seafood and coffee would be affected first after a week of strike action. Imports of non-perishable goods should be less affected, but congestion at West Coast ports could also worsen.

(1 USD = 0.9058 euros)