Why Is Extra Virgin Olive Oil So Expensive?

Why Is Extra Virgin Olive Oil So Expensive?

Alexandra Kicenik Devarenne

Extra virgin olive oil is the star of the olive oil family, with the best flavor, the most health benefits and the sexiest image. But this cachet comes at a price, often many times the cost of regular olive oil. Let’s look at what you are paying for when you buy extra virgin olive oil.

On a per-serving basis, extra virgin olive oil isn’t really that expensive
If you look at some of the components of this nice dinner, the cost of using a fine extra virgin olive oil for dressing or finishing is not much. A $25 bottle of wine will last for one meal whereas a $25 bottle of great extra virgin olive oil will enhance many meals.
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High cost of production
Making genuine extra virgin olive oil requires special attention and skill at every step of the process and this simply costs more. In the orchard, trees must be properly cared for to produce healthy olives and to protect them from pests and diseases. The harvest must be properly timed for the correct level of ripeness. Many smaller producers are hand harvesting, incurring high labor costs. Then the fruit must be quickly transported to the mill and promptly milled to avoid fermentation and other damage that results from olives that sit around for a long time.

To make good extra virgin olive oil, the mill needs to be clean and efficient, working under the direction of a skilled miller who is willing to make the right choices for quality—even when that means less quantity of oil. The finished oil must be filtered or racked promptly and stored under proper conditions: in cool, controlled temperatures and without oxygen exposure in spotless stainless steel tanks. This care continues in proper bottling and transport that protects from heat, air and light. All of these good practices add to the production costs for genuine extra virgin olive oil—and this is worth it!

The supply chain also has an impact on olive oil prices. An olive oil purchased at retail can pass through many hands after it leaves the producer: importer, distributor, broker, retailer, and finally, the consumer. And every time someone touches the product it adds to the cost, tripling or even quadrupling the price to the consumer. Domestic producers skip the importer stage, but the rest of the chain is the same. Large companies are able to shorten this chain by importing in bulk, acting as their own distributor, etc., but for small companies this is usually impossible. Shortening the chain by buying direct from the farmer-producer if you can is one way to ensure that the people who grow the olives see a profit, but that can be hard to do with brands that are imported because of shipping costs.

A range of prices
Extra virgin olive oil prices have a huge range. You can find a bottle for $4 or $25 or $50. Why such a difference? The way to look at the olive oil section is the same way you would look at wine. You will see bottles of wine for $3, $30 and $100 or more. The wine section falls into different categories from the super cheap to the very expensive. Olive oil is the same.

Many factors come into play when we look at extra virgin olive oil prices in the US. Lets start at the less-expensive end of the assortment. To a certain degree, price will be an indicator of quality. If an extra virgin olive oil is really cheap, that means that it is likely a very basic quality oil. As mentioned, there are higher costs to making and handling better quality olive oil. It will still be olive oil—worries about adulteration with other oils in the US market are grossly exaggerated—but there’s a good chance that it’s not going to taste fabulous. These oils are fine for cooking if you are on a budget but they won’t set your world on fire as finishing oils.

There are plenty of good—even great—choices to be found in the middle of the price spectrum. The cost of production varies a lot from country to country and from producer to producer, so in this middle range you can find some fine oils at moderate prices. As you get into the high end there are some truly extraordinary choices from great producers. The high-end also has a lot of products that are expensive just because they are expensive; the marketing is eye-catching and aggressive, and sometimes there are health claims that are not well supported.

There are no hard and fast rules about country or region of origin and quality—there are good oils produced all over the world. You may find that you personally prefer certain olive varieties or olive oil styles, and pretty soon you may find that you want a couple of different choices on hand (in addition to the olive oil you use for cooking). In our olive oil reviews we provide lots of information to help you find olive oils that will be to your taste.

What should I look for?
Different people have different priorities so buying criteria will reflect that. If you are concerned about the environment, for example, you may want to select an organic or biodynamic selection. Terms like “sustainably farmed” are not regulated in the US so you need to investigate the specifics behind a producer’s claims. There are some farmers who truly go the extra mile with habitat restoration, soil conservation, fair labor practices and low-input farming models; there are others who simply claim “sustainability” on their websites without providing anything to back it up.

One of the best ways to know what is behind a particular extra virgin olive oil is to buy from a company that actually makes the oil. That is not always the case: many brands are buying bulk product and bottling it under their brand name. There is nothing wrong with this, and it permits a brand to source oil from wherever they find the quality and price they want, but you lose that connection to the farmer and the land.

Especially in the higher-priced products you should expect true and total traceability: no named farm or farmers is a red flag that you might be getting an ordinary bulk extra virgin olive oil in a very expensive bottle! If that’s the case, you could buy an identical product for a fraction of the price and just refill your fancy bottle (just be sure to wash and dry it carefully first). Many passionate olive oil consumers want to know the people behind the product, so those buyers are looking for estate or farmer-producer brands.

Many of the finest extra virgin olive oils will be estate produced. In estate production, you should expect the brand owner to be the olive farmer. They may not own all the acreage, but they should control it and make the farming and harvesting decisions. In some cases, everything is done on the estate: growing, milling and bottling. But it is also common for these farmer-producers to take their olives to a trusted nearby mill. Estate producers will often be modest in size so their costs will be high—these are special olive oils that should cost more. But this high degree of control over production by skilled and passionate people yields the best olive oils in the world.

An estate extra virgin olive oil will give you the benefit of knowing the farmer behind the product. Olive oil quality starts in the grove, and the farmers are the true heroes of olive oil, the ones who deal with all the uncertainties of weather, pests and other production challenges. You might even find that you can visit the farm that produced your fabulous olive oil; olive oil tourism is an important source of income for many craft brands so seek them out when you are in olive oil territory! These are oils to pour generously for finishing, dipping and dressing. They can be used for cooking of course—if that fits in your budget—but you will fully appreciate their complex and lively aromas and flavors if you use them in raw dishes or after your food comes off the heat.