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After little more than a year of using olive oil from Greece for its Kirkland Siganture extra virgin olive oil, warehouse giant Costco has apparently switched back to Italy as the source for its green-gold elixir.
Costco switched to using extra-virgin olive oil (EVOO) from Greece for its private-label 2-liter bottles last year after the disastrous 2014-2015 harvest — plagued by bad weather, pests and wasting diseases — that saw Italy’s production plummet and prices soar.
But after a better 2015-2016 worldwide harvest, and with Italian EVOO production bouncing back and prices going down, Costco reportedy made the switch back to Italian, according to Olive Oil Times.
“It was what members wanted. They’re used to what they’re used to and there’s a perception that Italian EVOO is top-of-the-line. The Greek oil did OK — I myself preferred it in a blind tasting — but it was not quite as strong a seller,” Olive Oil Times quotes Chad Sokol, commodity and dry grocery buyer for Costco’s Northern California and Nevada stores, as saying. “And pulling our buy out of Italy was significant. Their pricing came down as a reaction, and that was our hope as well.”
It’s debatable whether the Italian olive oil price drop was in reaction to Costco’s earlier pullout or due to a better harvest. Costcodid not respond to a request for comment on the switch back to Italian EVOO for its private label bottle.
The 2015-2016 worldwide harvest is far better than the dismal 2014-2015 one, and production in Italy is up 112 percent, according to Olive Oil Times.Producer prices for Italian EVOO were down 35 percent from the same period a year ago, according to a June newsletter from the International Olive Council.
But David Neuman, CEO of the North American unit of Greek olive oil company Gaea, still sees opportunity for Greek EVOO.Neuman’s company, whose oil is still carried by Costco, has predicted the supply of Italy’s EVOO will drop drastically in the upcoming 2016-2017 harvest. Factoring in everything from the flowering of the trees to the weather, it forecasts that Italy’s production will be down 40 percent, while Greece’s will be down 35 percent.Since Greece, the world’s third largest producer of olive oil after Spain and Italy, uses less EVOO domestically than Italy does, it will have more to sell, Neuman believes.
Plus, Italy has been plagued by reports of less expensive oils labled as EVOO. (Costco, in its recent newsletter, says it has “worked diligently to ensure its Kirkland Signature EVOO is authentic and traceable.)If the upcoming harvest is as bad as it was two seasons ago, asked Neuman, “will Costco go back to Greece or somewhere else?”