On 4 March, Extenda organized a trade mission for the extra virgin olive oil sector from Andalusia to Indonesia, representing seven olive oil firms from the region to eight importers and distributors in the Asian country. The aim of the trade mission was to promote the commercialization of high quality evoo and the unique nutritional benefits of evoo to a market where consumption is booming due to the health properties of evoo, which has been particularly accentuated by the Covid19 pandemic.
The companies participating in this trade mission came from five provinces and seven appellations of origin:- Jaén, Tierras de Tavara and Jaencoop, from the D.O.P. Sierra de Segura, and Aceites Guadalentín, from the D.O.P. Sierra de Cazorla; of the province of Córdoba, FJ Sánchez Sucesores, of the D.O.P. Baena; Manzanilla Olive of the D.O.P. Sierra de Cádiz; province of Seville, Oleoestepa, of the D.O.P. Estepa; and the province of Malaga, Aceites Málaga de la D.O.P. Sierra de Segura.
The trade mission was aimed at Indonesian distributors and designed at marketing the culinary and health qualities of evoo and the different varieties of olive oil produced in Andalusia associated with the different Protected Appellations of Origin, to stimulate a more diversified demand for the food product. Andalusia is the leading community in olive oil exports to Indonesia, with EUR 2.1M (AU$3.23M) sales in 2020, which accounts for 48% of the national bill.
Extendeda CEO Arturo Bernal said that the the Indonesian olive oil market has become an "interesting emerging market for Andalusian olive oil, as demand is booming in the country due to the importance of healthy food consumption among the population, especially in the wake of Covid-19". According to Euromonitor data, "the value of olive oil sales in Indonesia is expected to increase from EUR 75M (AU$115.37M) in 2020 to more than EUR 112 million (AU$172.29M) in 2025, a growth of 49% over a five-year period."
Others, as Arturo Bernal points out, "We are faced with a very important niche market that we have to take advantage of from Andalusia, where we are world leaders in the export of olive oil thanks to an offer that combines quality and innovation. In 2020, the community exported oil worth EUR 2.252M (AU$3.46M), 76% of everything Spain bills."
The Data
Indonesia is Southeast Asia's largest economy and is projected as one of the great economic powers in the future. The growth of the middle class and its consumption capacity has awakened demand for healthy products such as olive oil.
This interest has soared as a result of the pandemic and increased health concern, so that, by 2020, EUR 75M (AU$115.38M) in olive oil was sold in Indonesia, and there is a growth forecast of 49% until 2025, when it would exceed EUR 100M (AU$153.84M) in sales, which would place it second among the edible oils after palm oil.
The Indonesian market has squeezed growth in its consumption capacity, accompanied by increased interest on the part of the population for imported agri-food products, including OVE. Thus, imports of this product have almost doubled from 2014 to 2018, from EUR $8M (AU$12.30M) to EUR $15M (AU$23.07M).
As for the exports of olive oil from Andalusia to Indonesia reached EUR 2.1M (AU$3.23M) in 2020, representing 9.9% of all community sales to Southeast Asia, which amounted to EUR 23.3M (AU$35.84M) last year, with growth of 2.5% compared to 2019.
According to Euromonitor data collected by Extenda, olive oil adapts to the consumption of households with high middle incomes, where the impact of the pandemic is likely to have less effect. On the other hand, these consumers are expected to increase their interest in health and well-being, opting for healthier eating options, even if they are more expensive, which would benefit the demand for olive oil.
In addition, olive oil brands have been using the influence of the internet and social media to actively promote the health benefits of edible oils such as olive oil, a trend that will continue in the future, as health and wellness will become a determining factor in purchasing decisions.
Andalusia's Leadership in Olive Oil Exports to Southeast Asia
Andalusia is the leading community in olive oil exports to Southeast Asia, concentrating 60% of domestic sales in 2020, amounting to an invoice of EUR 23.3M (AU$35.85M), thanks to growth of 2.5% year-on-year.
The advance in olive oil exports from Andalusia to the region has been helped by the increase in the number of exporting companies. In total, 46 Andalusian firms sold olive oil to Southeast Asia in 2020, which accounted for 31% more than in 2019. In addition, of these, 24, more than half (52%), are regular exporters (more than four consecutive years exporting), which bring together 94% of all exports.
The Philippines is its first market within the region, with sales of EUR 7.6M (AU$11.69M), 33% of the total and growth of 1.1% compared to 2020; Singapore, with EUR 4.4M (AU$6.76M), 18.7% and the highest regional growth, of 24.1%; Thailand, with EUR 3.9M (AU$5.53M), 17% and a decrease of 8.2%; Malaysia, with EUR 3.5M (AU$5.38M), 14.7% and a 5% increase; Indonesia.
Seville is the leading province in olive oil exports to Southeast Asia with EUR 19.9M (AU$30.61M) in 2020, 85% of the total and a year-on-year increase of 3.3%. It is followed by Cordoba, with EUR 2.9M (AU$4.46M), 12.4% of the total and a drop of 4%; Jaén, with EUR 293,000 (AU$450,715)(1.3%) 27.7% drop; and Malaga, with EUR 139,000 (AU$213,871)in sales, which quadruples its data since 2019. Source