The olive oil industry in South Africa is emerging as a beacon of opportunity and transformation. As the world’s appetite for high-quality, sustainable olive oil grows, South Africa finds itself at a crossroads to capitalise on this growing market or risk being left behind.
Wendy Peterson, chief executive officer of SA Olive, said South Africa’s olive industry is relatively small compared to other crops, with about 3 700 hectares of olive trees and 1.6 million litres of extra virgin olive oil produced annually. The industry comprises around 250 producers, including growers and nurseries.
“I do think that our producers over the last few years have done very well in terms of the market share and the prestige and the recognition in the global olive industry. Our producers have been winning international awards and we are very recognised in terms of international peers for high quality and the prestige of the product,” she said.
Rise in global demand
Peterson noted that there’s a growing demand for olive oil globally, creating opportunities for South African producers.
Ricardo Smith, economist at the National Agricultural Marketing Council (NAMC), shared that the industry has seen significant growth, with a notable increase in the number of hectares planted annually.
Smith said the industry has expanded from 1 800 hectares in 2012 to a substantial amount in recent years, with a growth rate of about 20% per annum.
“I think with the diverse olive oil industry, which it is now and which is going to grow, it is going to broaden the market even within the people that it represents,” he said.
Smith explained that olive production is concentrated in the Western Cape, which accounts for 95% of the country’s production. He noted that the region’s Mediterranean climate is ideal for olive cultivation with specific temperature and rainfall conditions needed for optimal growth.
“The olive industry is concentrated in the Western Cape province, which accounts for approximately 95% of domestic production. That is followed by the Eastern Cape at approximately 2%. Then Limpopo, Northern Cape and Free State, each of those provinces accounting for about 1%,” he shared.
READ NEXT: Excellence awarded: De Rustica is on top of the olive oil world
Challenges for small-scale producers
Loyiso Manga, the owner of Ubuntu Extra Virgin Olive Oil, expanded on some of the challenges that come with not owning land. He said small producers often rely on outsourcing processing, which can be a challenge during poor harvests.
Manga said there was a significant drop in last year’s production volumes that impacted many smaller brands. He highlighted the importance of land ownership and control over the value chain.
“I think the biggest challenge is when you get a year like last year, 2022-2023, which I think was the worst in the last 25-odd years. And unfortunately for people like myself who own brands and who are still aspiring to own the first black-owned olive oil farm in the country, you do stay in a disadvantaged place,” he said.
Supporting local production
Manga noted that the olive oil industry in South Africa has the potential for further growth, particularly if challenges are addressed and more regions are explored for cultivation. Increased local production could reduce the reliance on imports and support broader economic growth.
“I think we need to start being patriotic about small entrepreneurs, small businesses that are using agriculture as a side hustle or as a second form of income. That’s the main focus is to be at least a bit prouder and to be a little bit more Pan-African when it comes to supporting African products, because when we go to other countries, they truly, truly love what we are doing here,” he said.
ALSO READ: Women in Wine scores big retail deal with Shoprite
Sign up for Mzansi Today: Your daily take on the news and happenings from the agriculture value chain.
