Olive oils are bringing health benefits, high margins and renewed interest back to Center Store.
By Richard Turcsik
Forget the Middle East. The real hotspot in the world’s oil market is in center store. That is where shoppers are flocking to pick up the latest in olive oils from Spain, Italy, Greece, Tunisia, Chile and a host of other countries. Even domestic olive oil from California is carving out a niche as many consumers look to country of origin labels and ways to reduce their carbon footprint.
“The olive oil category really is at an all-time high in the U.S. with household penetration at 42%,” says Dave Scheiber, vice president of marketing for SALOV North America Corp., the Lyndhurst, N.J.-based owner of Filippo Berio Olive Oil Co., a brand dating back some 140 years. “Imports this past year were over 260,000 metric tons, compared to 200,000 metric tons in 2001,” he says.
“Olive oil is a wise choice in healthy fat consumption,” says Kenia Delgado, category manager for Secaucus, N.J.-based Goya Foods. “The Mediterranean people are known to use olive oil for centuries in almost everything they eat for health and beauty. Olive oil contains antioxidants that can assist in the fight against a host of diseases, and our Goya Extra Virgin Olive Oil is as versatile as it is healthy.”
“The FDA has determined that eating two tablespoons of olive oil per day can reduce the risk of heart disease,” says Roberto Avila, director of marketing at Borges USA, the Fresno, Calif.-based marketer of the Star olive oil brand. “The health benefits of oil are just tremendous. It’s 100% natural, high in monounsaturated fats, which help lower the bad LDL cholesterol, has antioxidants and vitamin E, no carbohydrates or trans fats and it’s gluten-free. The list goes on and on.”
Still, Avila notes that with only 42% household penetration, olive oil still has a long way to go. “There’s lots of opportunity and a lot of education to be had,” he says.
Making matters more confusing, the olive oil category is becoming more and more fractured, with the latest trends being country of origin and specific varietals.
A variety of varietals
“There are 600 different varieties of olives,” Avila notes. “There are more varieties of olives than there are grapes, so it gets pretty complex.”
Borges is working on mono varietals and region-specific olive oils, Avila says. “We have one made from an Israeli olive that is produced and bottled in Israel. It is kosher for Passover.”
“Most of our oils are regional oils,” says Nicole Moore, public relations coordinator for New York-based gourmet food importer American Roland Corp. “We have Tuscan, Kalamata, Sicilian, Puglian and organic. Puglia is a region in Italy and our oil is certified.”
Despite the current political turmoil, some of the hottest olive oils are coming from the North African country of Tunisia. “Tunisia is very close to Italy, about 65 nautical miles across the Mediterranean, so the climate is similar,” says Al Hamman, owner of Hamman Marketing Associates, a Johnson City, Tenn., marketing firm representing the Tunisian government and its olive oil producers, including the Terra Delyssa and Rivière d’Or brands.
“They grow different varieties of olives in Tunisia that I haven’t heard of being grown anywhere else—Chemlali, Chetoui and Oueslati,” Hamman says, adding that even if Americans aren’t familiar with Tunisian olive oil, chances are they have eaten it. “Tunisian oils forever have been sold to the European market in bulk for blending. They have a very soft, mild, buttery taste, which is something Americans like,” he says.
Tunisia is just one of the up-and-coming countries producing olive oil, says Bob Bauer. He is president of the North American Olive Oil Association, a Neptune, N.J.-based trade association that promotes the olive oil industry. “Chile is a big grower and there will be some more from South America coming, including Argentina and Brazil,” Bauer says. “But the bulk is still coming from the Mediterranean countries. Imports are going up, which means consumption is still going up, as imports account for 99% of the olive oil consumed.”
One out of every four of those olives comes from Spain and the country is the No. 1 olive oil producer in the world, notes Jeffrey Shaw, director of Foods from Spain, from the Trade Commission of Spain’s office in New York. “Olive oil from Spain is produced from unique olive varietals grown only in Spain—such as Picual, Cornicabra, Hojiblanca and Arbequina—making the flavor of the oil distinct from all others,” Shaw says. “Similar to fine wine, the olive varietal, along with the region’s soil and climate, are what gives olive oil its distinct taste.”
According to Shaw, in 2010 olive oil exports from Spain grew by 31%, reaching 65,969 metric tons. By comparison, Italy’s tonnage fell by 5%, while the total category grew 1%.
One of the leading Spanish imports is Goya, which offers Spanish olive oil in Extra Virgin, Pure and Light varieties in 8.5-, 17-, 34- and 50.7-ounce sizes. “Currently we merchandise our olive oil with the Goya set if there is a dedicated Hispanic or Goya aisle,” Delgado says. “But we are definitely looking to attract not only the Hispanic consumer, but the general market as well. We would like to start doing at least secondary displays within the olive oil aisle to attract even more consumers.”
Retailers should also offer an olive oil from Greece in their set, observers say. Greek Land Foods, Ltd., based in Kifisia Athens, Greece, offers extra virgin olive oil, organic extra virgin olive oil, Classic olive oil, balsamic vinegar, organic balsamic vinegar, Kalamata olives and organic Kalamata olives under the Esti brand name.
Olive oil novices may wish to start out with the Esti Classic, a mild blend of extra virgin and refined oils that features a very pleasant taste, discreet aroma of ripe fruits and a light green-yellow color. By comparison, Esti’s extra virgin oil is made from Koroneiki olives that grow in Mani, a region of Messinia, at the foot of Mt. Taygetos.
The olives are handpicked from November until February. The juice is extracted just a few hours after harvest, giving it a very low acidity and rich content of polyphenoles, plus a bright green color and a fruity, bittersweet taste that hints at the smooth feeling of various fruits, with a predominant apple taste.
Oil for the masses
Miami-based Lucini Italia Co. is looking to attract more shoppers by introducing the Lucini Estate Select label, a more popular-priced olive oil line that is being sold at Walmart, Target and other mainstream retailers.
“Our Lucini Premium Select oil is a little too expensive for that consumer and our fancy faceted bottle was seen as a bit of a turnoff,” says David Neuman, president. Lucini Estate Select is the same quality as Premium Select, only instead of coming from a small, dedicated olive grove it is sourced from a wider pool of growers.
“We have answered the calls from consumers who demanded Lucini quality at a lower price,” Neuman says. “It wasn’t easy. It took us two years to find it, but it is a much higher quality than the commercial oil brands on the market. At the end of the day, quality will always win.”
Pompeian is another brand that prides itself on its quality. Over the past three years, since a major packaging relaunch with state-of-the-art PET bottles, the Baltimore-based company’s market share has gone up about 40%, outpacing the category, says Bill Monroe, CEO.
Pompeian imports its oil in bulk and bottles it in the U.S. “We bring it to our plant in Baltimore where we store over 1.5 million gallons,” Monroe says. “Our labs and taste panels look at the product for quality and we have the ability to bottle it fresh daily, giving us an advantage over oils packed in different parts of the world. We’re about two to three months fresher because of our ability to do that.
“Not only is that more cost effective, but because we pack in the U.S. and are not shipping heavy glass and other packaging we actually reduce our carbon footprint,” Monroe says.
Consumers really looking to reduce their carbon footprints are turning to Corto Olive Co. brand oil, which is produced domestically in central California. “We are part of what we hope is a significant new industry in California,” says Brady Whitlow, president and CEO of the Lodi, Calif.-based company. “California is an ideal environment for olive oil because the climate is very much like a Mediterranean climate so we believe we can produce an extra virgin olive oil that can rival our friends across the pond.”
Corto is making a making an environmental statement in another way too. Unlike the centuries old gnarly trees that conjure up European images of olive groves, Corto uses a “Super High Density” technique that plants dwarf trees in tight rows, similar to grapevines. “We can get 700 trees to an acre using our method,” Whitlow says.