Growers Cultivate a Taste for California Olive Oil

For much of the last century, California olive farming has focused on the pitted black table variety that children -- and some adults -- like to eat off their fingertips. It’s been a tiny niche in the global olive industry.

But now, growers using farming techniques typically found in a vineyard believe they can turn the Golden State into an olive oil force -- one that can compete profitably with the big European producers that dominate the U.S. market. High-density plantings, mechanized harvesting and investment in olive mills are allowing California’s olive oil industry to take on the rest of the world, where hand picking and traditional, widely spaced orchards are the rule.

California farmers this year will plant about 2,000 acres of olive trees for oil production, expanding the amount of land devoted to the crop by about 30%, said Paul Vossen, an olive specialist at the University of California Extension in Sonoma.

Vossen projects that growers will continue to add that many acres a year through at least 2009. That would put the state’s olive oil industry, in production terms, a par with France’s industry.

The growers are expanding at a propitious time, said Darrell Corti, an olive oil expert at Corti Brothers gourmet supermarket in Sacramento.

A drought and other problems have cut production across much of Italy and Spain, driving up the price of imported oil. At the same time, European Union officials are looking at phasing out subsidies for the industry, which amount to about 35 cents for every 16.9-ounce bottle sold in the United States.

And the U.S. Department of Agriculture is expected to revise its olive oil standard, instituting a stricter definition of what constitutes “extra virgin”-grade olive oil. That’s likely to stop a practice by some European and other importers of blending different grades and types of oils but still labeling the product “extra virgin” when it is sold in the U.S., Vossen said. Such a move would drive up the price of higher-grade oils and make California production more competitive, he said.

A prime example of the state’s productivity is California Olive Ranch in Oroville. Anyone driving by the ranch could easily mistake it for yet another of California’s ubiquitous vineyards. Rows of plants, hundreds deep across 483 acres, parallel the roadway. Each of the 320,000 trees is meticulously spaced 5 feet apart, supported by a trellis system similar to what a visitor would see in Napa Valley. This allows the ranch to pack 675 trees in the same space occupied by 120 in a traditional European olive farm.

During harvest, which is expected to start later this week, modified mechanical grape pickers will scoot through the rows, stripping the trees of fruit that will be quickly taken to the adjacent mill.

“We can go from trees to oil in just 90 minutes,” said Alan Greene, general manager of the ranch.

Using the mechanical picker, a two-person harvest team can collect in an hour what in much of the world it takes 40 people to pick by hand, Greene said.

And processing speed is one of the key ingredients of quality olive oil, Corti said. “Get good fruit and work it quickly; that’s what you need.”

Corti sells 16.9-ounce bottles of California Olive Ranch oil at his market for $9.99, a price that makes it competitive with imported products. Trader Joe’s sells oil from the ranch labeled simply as California olive oil for $4.99.

Corti believes there is a huge market for California olive oil. Consumption has long been on an upswing as Americans have developed a taste for the oil and heard of its reported health benefits. About 65 million gallons of olive oil are consumed in the U.S. annually, eight times the volume of 20 years ago, according to the California Olive Oil Council. Yet all but 1% of that oil is imported.

California produced 383,000 gallons of olive oil last year, Vossen said. That’s a 25% gain over 2003. California Olive Ranch accounted for nearly a quarter of that production. Vossen estimated the retail value of the state’s olive oil industry at about $85 million, just a tiny fraction of the $15-billion retail value of California’s wine industry.

“Our biggest problem is that we have not had a lot of producers,” Corti said.

Californians have made olive oil since the founding of the Spanish missions, with the first commercial production taking place at the Camulos mill in Ventura in 1871.

Just a decade later, California growers were pressing oil from 2,000 acres of trees, but competition from Europe kept the industry small.

By the mid-1990s, the acreage devoted to olive oil had not grown from what was farmed 125 years earlier. At the end of last year, just 16% of California’s roughly 40,000 acres of olive orchards were devoted to oil production.

Except for a brief period when olive oil supplies were cut off by World War II, California farmers focused on table olives that could be pitted and canned and used for sauces, pizza, salads and snacks. The state still supplies most of the nation’s black olives.

Only in the last decade has interest in oil production resurfaced, starting with small-scale plantings by gourmets and vintners, mostly in Northern California.

But now it has caught the attention of mainstream farmers such as Vern Olson, manager of Running Luck Ranch, east of Fresno. Elsewhere, his farming company has planted almonds, which over the last decade have become California’s largest cash crop. But he thought it best to diversify into other commodities that were also likely to be profitable.

This year the 539-acre ranch that Olson manages converted 190 acres of peaches, plums, nectarines and grapes to a high-density olive orchard.

“The other half of the ranch is wine grapes, so this makes a lot of sense for us,” Olson said. “The grapes and the olives are all grown on the same spacing, the same trellis system, and I can use the same harvesters, drip water system, tractors, discs and even pruning crews.”

With farmers getting $8.50 to $15 a gallon for oil, he figures the venture will be profitable.

“When it hits $15,” Olson said, “that’s equal to grapes at $350 a ton, and the agriculture cost for olives is a bit less. It’s a real good price.”