About Us
Farm Background
Our Operating Philosophy
The South African Olive Industry
Location
Olive production is relatively new in South Africa (in 1661, Jan van Riebeeck planted the first two olive trees on his farm Boschheuvel in the Cape. However, the fruit of the olive tree was not exploited for another 200 years). The industry is concentrated in the Western Cape, with its typically Mediterranean climate, cold wet winters, hot dry summers. This area accounts for more than 90% of the estimated 1.6 million trees in South Africa, owned by close to 140 producers. Other producers are located in the Northern Cape (Hartswater), Free State and Mpumalanga. With the growth in demand for olive oil, groves are being established throughout the country in niche areas with climates approximating Mediterranean, with varying degrees of success.
Positioning
The unique feature of the olive industry is that the olive harvest falls outside of the deciduous fruit and grape season, thereby positioning olives as ideal ‘fillers’, post vine harvesting and pre fruit harvesting. Unlike deciduous fruits which are offered in the market as fresh fruit, olives are offered only as a processed fruit affording them an advantage when it comes to shelf life. In addition, the trees are resilient against drought, making them an attractive and valuable addition to this agricultural sector.
Production
With an annual production of approximately 2000 tons of olive oil (5-8kg of olives to make 1 litre of oil) or 10 000 tons of oil olives, the South African olive oil industry is not a significant global player when compared to leading countries like Spain that produce in excess of 1.2 million tons of olive oil per annum. The total South African consumption of olive oil is +-3.5 million litres, of which local production is currently less than 20%. Local production of table olives is estimated at 3000 tons pa while 600 tons are imported annually.
Quality
South African producers and processors have a culture of producing quality olives and olive oil, as demonstrated by the many prestigious international awards received. Approximately 95% of South African olive oil produced is Extra Virgin Olive Oil (EVOO), whereas a very small proportion of the EU production meets this standard. The reason for South Africa having such high standards is because we have managed to leap frog the industrial development process with 3rd generation machinery and technology.
Unfortunately local consumer knowledge of quality olive oil is poor. In contrast to traditional olive oil consuming countries where per capita consumption of olive oil ranges between 12 - 24 litres per annum, the average South African consumes a mere 80ml per annum. This lack of knowledge is exploited for gain by the importation of adulterated olive oils (mixing oils of inferior quality) and marketing of supposedly superior European imported oils at higher prices. The situation is further exacerbated by the EU subsidies paid to olive growers. These subsidies enable EU producers to undercut the local processors with attendant loss of sales and ultimately job losses.
Structure
In South Africa, 10% of the players are responsible for 90% of volume produced. There are a myriad of small growers and boutique style table olive and olive oil processors that add flavour and interest to the industry. Based on the rate at which new trees are being planted, olive farming is growing at 20% per annum, i.e. it is doubling in size every four to five years, making it one of the fastest growing agricultural segments in the country. This is in response to an increase in olive and olive oil consumption, given the growing awareness of the health benefits of olive products.
The interests of the South African olive industry are represented by SA Olive, a voluntary non-profit association whose members are directly involved in the industry (i.e. growers, nurseries, table olive and olive oil processors).
Future of the Industry
The olive industry in South Africa has a very promising future. All the required elements of a potentially world class industry are taking shape. The appropriate farming environment (Mediterranean climate and rotational crops), affordable land and suitably skilled labour, all of which are required to provide a high quality, cost competitive growing and production base, exist and are firmly established in the Western Cape. The emergence and continuous development of the necessary related and supporting industries, fast tracked on the back of a mature wine industry value chain, are enabling international price competitiveness, product quality and innovation.
Under developed market demand conditions, policy, regulatory and consumer related, remain the only real obstacle to the olive industry achieving its full economic potential and playing its rightful role in rural sustainability and agricultural transformation.
In partnership with relevant Government Ministries and Departments, the SA Olive Association is working on ameliorating present demand constraints. The interventions are targeting two areas: firstly, levelling the playing fields on pricing by introducing countervailing duties to offset the EU subsidies paid to European olive farmers and olive oil producers; secondly, quality control standards, regulation and policing mechanisms are being established to halt existing demand manipulation through fraudulent imports and product adulteration practises. The association continues to drive local customer education by establishing national competitions.