Deoleo saves a match point and leaves the olive oil crisis behind

Deoleo, the world's largest branded olive oil company (which owns Carbonell, Koipe, Bertolli, Carapelli, Elosúa and many others), has, like its clients, undergone a stress test that has lasted two years. During this time, prices have remained unusually high due to poor olive harvests, which has led to some of its buyers fleeing to other products, mainly seed oils (sunflower, corn, rapeseed and others). Deoleo went from earning 6 million in 2022 to losing 34 a year later.

During this time, doubts were also raised about the continuity of the main shareholders in the company, the Alchemy and CVC funds, released since December 24 from the commitments to remain in the capital they acquired in the past. But in the autumn of 2024, several important news items were released: after the announcement of half-yearly sales, the company emerged from losses and Ignacio Silva, president and until September chief executive , handed over powers to a new CEO, Cristóbal Valdés, from the canning company Jealsa. Shortly afterwards, another announcement: Deoleo refinanced its debt, of 160 million, with the return of JP Morgan as the holding bank together with Blackrock. The four-year maturity gives the company another perspective on the medium term.

But the most important thing of all is that the oil mills have begun to fill up again. If in the 2023-2024 campaign Spanish oil production was limited to 800,000 tonnes, in 2024-2025 it could reach, according to estimates collected by the publication Olimerca , 1.4 million . Farmers breathe easier although in the sector they fear that the pendulum theory will come true and prices will end up being abnormally low, with the risk that they will not even cover the cost of production.

As far as Deoleo is concerned, the present looks better than the past, when it accumulated (in 2019 figures) a debt of 572 million with an operating profit of just 15 million.

With a presence in 80 countries, 27 brands and 625 professionals, its turnover will be around 1 billion euros (it will present the final figures for 2024 in the next few days). They are resuming their goal of being a multinational company of high standing, and not a pocket-sized one as Silva lamented in recent statements. “Carbonell is going to be 160 years old, Bertolli too, we have Sasso, Maestros de Hojiblanca, Koipe… We have agreements with more than 80 audited oil mills that we help to comply with the pillars of sustainability. We provide training on how biodiversity should be in the olive grove, how the vegetation cover should be, how the soil should be, but also on how governance should be, we encourage the incorporation of women…”, describes José Antonio Bonache, the company’s communications director. At his side, Enrique Weickert, the group's financial director, sums up that in these annus horribilis they have shown “resilience and agility”, with an operating profit that has not fallen below 30 million, looking for partners to reach supply agreements - since they are only bottlers. “Faced with a lower possibility of obtaining olive oil, the only variable to obtain supply was the price”, he says. A price that shot up by 130% according to data from the Ministry of Agriculture. “Something unthinkable”, he reflects.

The fall in olive oil consumption in Spain was estimated at 18% and was somewhat less in Italy (10%) and the USA (7.5%), a country that is supplied mainly by imports. They feared whether their brands would be able to withstand the increases or, on the contrary, they would lose sales volume, customers and market share. They also feared whether their differential with other competitors could widen, harming their competitive position. They suffered, going from selling about 180 million litres of oil to 140 million; their operating profit fell, but the same happened to their competitors and they were able to maintain or even gain market share (in Spain they grew by 2%), maintaining their profit margins for each unit sold.

The million-dollar question is how many of the buyers who fled will choose green gold again from now on. “There will be a recovery in the category, but we think it may take two years.” In 2026, according to his calculations, consumption levels in countries could be close to those before the price hike. Weickert knocks on wood. “With the increase in the harvest, prices will go to a different place. Everything has gone up, it doesn’t seem reasonable that we will see a bottle of oil at two or three euros again, but it won’t be at seven, eight or nine either. It will reach a level of equilibrium. Bad years are for learning, we have done it with higher levels of austerity and efficiency,” explains the financial director.

During this time, he adds, they have passed on to the consumer almost all of the increase in raw material prices and have been surprised by how resilient their brands are. Brands in which they have not been able to invest as they would have liked, because one of the expenses cut has been marketing. “Despite this, it is impressive how we have maintained market share. This shows that in the Mediterranean countries we have not wanted to give up the role of extra virgin olive oil, even at an unsustainable price.” At Deoleo they defend that olive oil must have an affordable price, “which rewards each component of the value chain, from the farmer, the oil mill, the producer, distributor. Nobody benefits from having the levels of the last two years.”

Trade barriers

As if the market weren't already surprising enough, a conflict with the Italian courts over the payment of tariffs could cost the company 89 million euros, although they are confident that they will end up winning the lawsuit. In addition, there are the measures that the Trump administration could impose on imports. "We are considering whether it makes sense to produce in the United States. It is not the first time that we have had tariffs . If they are established, we would have to see what type of products they affect. Those who will be harmed will be consumers, for whom a healthy product would become more expensive and less accessible. Nobody wins."

The company has begun a period of reflection on its strategic plan for the coming years. They are looking for opportunities to explore: for example in India, where olive oil is becoming popular as a gift to rub on babies' bodies; or in the USA, where they can take advantage of this to increase sales of other products, such as vinegars, sauces or olives. In Mexico, their sales are growing at a good pace and in other countries, such as Colombia, they are introducing the use of olive oil by mixing it with other seeds that are more consumed locally. Their sprayers are all the rage among those who have air fryers. In short, they believe that a new stage with a tailwind is beginning: a new CEO, new financing, the support of the funds (which have stated that it is not the time to sell) and strong brands.