California’s burgeoning olive oil industry is expected to have a record-breaking year in 2015 as demand and acreage continue to grow.
This year, the state’s olive growers are estimated to churn out 4 million gallons of California extra virgin olive oil, nearly double the amount milled in 2014.
Much of the growth is coming from new, higher-yielding orchards that have been planted statewide, including in the central San Joaquin Valley. The region is now home to nearly a dozen companies crafting high-quality oils.
Even foreign growers have recognized California’s potential. Australia’s largest olive oil company, Boundary Bend, opened its first U.S. facility earlier this year in Woodland and has plans to expand over the next several years.
California’s olive industry leaders say that much of what sets the state’s 400 olive oil producers apart from their larger foreign competitors is quality.
400 Number of olive oil producers in California
While California has grown olives for decades, the trend now is to plant olive varieties specifically for their smooth and rich tasting oil. These days, the number of olive acres harvested for the cannery has dropped from a peak of 38,000 in the late 1970s to just 18,000 acres currently.
“Table olives are going the other direction,” said Adin Hester, president of the Oliver Growers Council in Visalia. “The numbers are up for olive oil production and it makes sense.”
The state’s olive oil estimate may not seem huge, compared to mega-crops like almonds and milk that produce in the billions of pounds or gallons, but it’s a big deal for the industry.
“We are growing by a percentage point a year and that is incredible considering we were just 1 percent of the total market in 2011 and now we are 4 percent,” said Patricia Darragh, executive director of the California Olive Oil Council in Berkeley. “The demand is growing.”
The olive oil council estimates the size of the state’s olive acreage at 35,000 with an additional 3,500 acres expected to be planted each year through 2020. California’s fourth year of drought also has made the drought-tolerant olive tree more attractive to some growers.
“Farmers are looking at their portfolios and trying to manage their water availability,” said Kimberly Houlding, executive director of the American Olive Oil Producers Association in Clovis. “So when you have a tree that takes half to one-third of the water of other tree crops, then olives begin to make sense.”
Although California represents just 4 percent of the market, with major imports coming from Italy, Spain and Tunisia, it has been quietly nibbling away at the importers’ dominance.
Helping to turn the tide was a landmark 2011 study done by the University of California that found the quality of some of the largest imported brands was inconsistent at best. It also found that most of the top-selling olive oils failed to meet international standards for extra virgin olive oil.
Farmers are … trying to manage their water availability. So when you have a tree that takes half to one-third of the water of other tree crops, then olives begin to make sense.
Kimberly Houlding, executive director of the American Olive Oil Producers Association
True extra virgin olive oil has to meet international standards for how it is stored and processed, meaning no chemicals or extreme heat is used during the extraction process and the oil is free of defects of flavor or odor, according to the California Olive Oil Council.
Among the Valley olive oil makers having success is Vincent Ricchiuti, whose family operates the award-winning Enzo Olive Oil. The family farms 400 acres of olives in Madera and may be planting more.
Working in California’s favor, Ricchiuti said, is its quality and strong consumer interest in local and U.S.-made products.
Enzo recently signed a deal to sell its organic extra virgin olive oil at more than 1,000 Publix grocery store chains. The Florida-based chain operates primarily in the southeast.
“When Publix brought us on we began to see new possibilities,” Ricchiuti said. “If we want to continue to grow our client list, we are going to have to plant some more acres. There is no question that people are becoming more aware of California extra virgin olive oil.”
To help remind consumers that there is a difference between California and imported oil, the California Olive Oil Council also certifies that its members’ oils are 100 percent extra virgin olive oil. The organization represents about 90 percent of the state’s 400 olive oil producers. The council’s certification process involves meeting or exceeding specific standards for acidity level and ultraviolet light absorbency. A blind panel taste test also looks for taste and odor defects.
“People are starting to see the quality of what we produce and it is only inevitable that there will be more growers and oil being produced, ” said Katrina Van Conant, co-founder of Scout Olive Oil in Clovis, one of the Valley’s newer oil makers.
As Australia’s largest olive oil producer, Boundary Bend wants to tap the U.S. demand for premium olive oil, especially oil from California. The U.S. is the world’s fourth-largest market for olive oil.
The company, whose flagship brand is the award-winning Cobram Estate, is spending more than $20 million on a mill, storage facility, laboratory and office in Woodland, just north of Sacramento. The company will be milling oil from California growers as it prepares to plant its own trees next spring.
Adam Englehardt, chief executive officer of Boundary Bend’s U.S. operation, said the plan is to plant 300 acres of olives a year over the next seven years.
“Consumers are wanting a higher quality, domestically produced oil, and we can provide that,” Englehardt said.
As part of the company’s growth plan, Boundary Bend is looking at building additional processing plants in other olive producing regions of the state, including the Valley. Englehardt said Boundary Bend has identified the Valley’s westside as an area of interest for new olive trees. The challenges are high land prices and the presence of a fungus known as verticillium.
“We have to be able to find land at a price point that is sustainable for this company,” Englehardt said. “But we are looking.”