Tunisia’s olive oil production to overtake Italy after bumper harvests

Tunisia is set to overtake Italy as the world’s second-biggest olive oil producer as it gears up for one of its strongest seasons in years, giving its economy a much-needed boost.

Olive oil producers in the heavily indebted north African country are expecting a record harvest thanks to good rainfall this season, which would place it ahead of both Italy and Greece and second only to Spain, among the world’s top producers.

Vito Martielli, senior analyst grains and oilseeds at Rabobank, said he expected Tunisia’s olive groves to yield 380,000 to 400,000 tonnes of oil in the 2025-26 season.

This would be up from the previous season, which according to Rabobank was estimated at 340,000 tonnes, and would help Tunisia’s economy, which has suffered from high public debt and weak growth since authoritarian President Kais Saied took power in 2021.

Najeh Saidi Hamed, who heads the Tunisian Olive Producers Chamber, said she hoped the harvest could rise as high as 500,000 tonnes, which would make for a “record level of oil production”.

Martielli said the increase could also be attributed to the rise in olive oil prices in recent years. “The price reached $10,000 per tonne . . . this has triggered some expansion [in Tunisia] and, as a consequence, you see more production.”

From late 2022, drought and heatwaves exacerbated by climate change knocked olive oil output in Spain, the world’s largest producer, as well as other major producing countries such as Italy and Greece, driving up prices. This prompted farmers, especially in north Africa, to increase production.

Olive oil exports and a flourishing tourism sector have been important drivers of foreign currency revenue for Tunisia. The country has been shut out of global debt markets since 2023 when the president rejected a $1.9bn IMF bailout, saying he would not accept “diktats” about how to run the economy.

Saied seized full power in 2021 and proceeded to dismantle the democratic system under which he was first elected president in 2019.

The president’s power grab was broadly welcomed by Tunisians frustrated by the failure of elected governments during the preceding decade to reverse plummeting living standards and address economic problems including high unemployment.

However, economic growth has remained weak under his rule — only strengthening to 2.4 per cent in the first nine months of 2025, according to the World Bank, “driven mainly by favourable weather conditions that boosted agricultural production and a revival in construction and tourism”.

Tunisia’s recovery, the bank added, “remains moderate compared to regional peers”.

The improvement in economic outlook has been fortuitous and a reflection of a “positive global outlook”, rather than an outcome of intentional reforms, argued Riccardo Fabiani, north Africa director at the International Crisis Group.

“You have tourism that is picking up,” he said. “You have, most importantly, remittances from Tunisians abroad which are helping. Also positive weather has boosted agricultural exports. These results are not the outcome of a specific, precise policy.”

Another good olive oil harvest would “help tide things over”, said James Swanston, senior economist at Capital Economics, a London-based consultancy. Olive oil exports in 2023 brought in a record $1.3bn “helping at a time of big external strains”, he said.

Most of Tunisia’s olive oil is exported in bulk, with Italy the biggest buyer. Italian producers import large volumes to offset their own production shortfalls, blending and re-exporting the oil under European labels — a process that often obscures its Tunisian origin and has raised concerns about transparency.

Spain and France are also steady customers, while the US has become a growing market as olive oil consumption spreads beyond the Mediterranean.

Moez Labidi, Tunisian economist and adviser to the Arab Planning Institute in Kuwait, said however that Tunisian entrepreneurs were holding back from new investment, adopting a “wait and see attitude” given the “uncomfortable business climate”.

Saied has repeatedly made clear his suspicions of the business class, which he has often accused of corruption.

Soon after taking power he announced that businessmen and officials had stolen about $4.8bn through unpaid taxes and fraud, and referred to a list of 460 names. He said he would offer an amnesty to those accused of corruption if they agreed to make financial settlements with the state.

No such settlements appear to have occurred, analysts say, but some entrepreneurs have been arrested and, according to reports, others are being investigated.

In November, a Tunisian court ordered the release of olive oil exporter Abdelaziz Makhloufi on bail of $17mn after a year in jail. The founder of CHO Group, Tunisia’s largest olive oil export company, he was arrested over allegations of mismanagement of a state-owned agricultural property.

“There is a fear by entrepreneurs to do anything because the economic outlook is completely unpredictable,” said Fabiani. “They also think that whatever they do, they will be punished.”