Lebanon: Soaring inflation turns olive oil into a luxury

Imad Waresbi is a 43-year-old resident of Tripoli in northern Lebanon who produces and trades olive oil for a living. He sells his oil for a wholesale price of $5 (€4.50) per liter, which is a fairly reasonable price for the product, he said.

In the shops, however, a liter nowadays costs around $10 or even more, he told DW. "People buy olive oil from me so they can profit from it or save some money or because people are looking for cheap olive oil today."

Lebanon has a rich history of both producing and consuming olive oil. Not only is it a crucial component in many traditional Lebanese dishes, such as Tabbouleh, Fattoush, and Mujadara Hamra, but the olive tree itself is deeply ingrained in Lebanese culture.

Furthermore, as a country that relies heavily on imports, olive oil is one of the few commodities that Lebanon can export.

Olive growers squeezed by inflation and crisis

The ongoing economic crisis in Lebanon, including currency woes that saw the US dollar become the preferred legal tender, has pushed millions into poverty. It has significantly impacted the purchasing power, particularly of those who continue to earn in local currency instead of dollars.

Waresbi said that despite selling olive oil to dozens of clients, he only earns around $500 per month. With the cost of living in Lebanon worsening day by day, he sometimes struggles to afford olive oil for himself and is forced to use cheaper cooking oil instead.

"What I earn is not enough as I have to pay bills, rent, food, and other expenses," he said.

The latest inflation figures published by Lebanon's Central Administration of Statistics show the annual inflation rate for food and nonalcoholic beverages has surpassed 350%. In March, the rate surged by 264% over the year, despite the official decision in February to devalue the Lebanese pound by 90%.

The official exchange rate now pays 15,000 Lebanese pounds for a US dollar — significantly higher than the previous rate of just over 1,500. However, the parallel market exchange rate currently stands at around 96,000 Lebanese pounds at the time of writing.

Retail markets in Lebanon sell olive oil for prices ranging from $7 to $11 per liter, or even higher, depending on the quality of the product. This equates to between 672,000 and 1,056,000 Lebanese pounds, well beyond the means of many given a national minimum wage for private employees of 9 million Lebanese pounds per month — equivalent to approximately $93 or €84.

The wholesale market of olive oil

Those who cannot afford to buy olive oil in shops use other cooking oil, such as sunflower oil, or buy olive oil at the wholesale market. 

The price of wholesale olive oil varies from $65 per 16-kilo (35-pound) tin to more than $100.

Olive oil vendors advertise their products on Facebook groups and other social media platforms and deliver olive oil across the country. They may also be known through word-of-mouth recommendations.

People who have land for olive trees, especially those living in small villages, often take their olives to the mills to be pressed into oil for their own personal use. However, the cost of transportation and maintenance of the land means this is not a cheap option.

Medal-winning olive oil

Although the price of olive oil has increased, Lebanese people have not relinquished their historic attachment to it, continuing to take pride in the excellence of the country's traditional ingredients.

In April, a Lebanese brand named Darmmess, based out of the village of Deir Mimas and founded by Rose Bechara, won a gold medal at the NYIOOC World Olive Oil Competition, the largest and most prestigious olive oil quality contest in the world. Bechara told DW that Lebanese olive oils are not well-known globally.

"This has been a challenge because one of our missions is to build a territorial branding for Lebanese olive oils. So, it has been quite hard to tell the whole world that we can have outstanding olive oil," she said.

Bechara attributes the success of Darmmess phenolic extra virgin olive oil to the centenarian and millenarian olive trees, the collaboration with local farmers who use organic agriculture and early harvesting to ensure top-quality olives, and the unique soil and altitude of Deir Mimas, which has earned it the nickname of the "Bordeaux of Olive Oils."

Darmmess olive oil is sold domestically and internationally, priced at $15 per 500 ml in Lebanon and between $20 and $30 abroad.

Lebanese olive oil industry struggles

The success story of Darmmess, however, did not come without challenges.

Bechara's socially oriented enterprise lost money when the economic crisis began because the funds in its bank account were frozen. Additionally, it encountered various production-related issues.

Fuels have become much more expensive after the government lifted subsidies, and Bechara faced a shortage of glass for bottling, which is imported. Additionally, Bechara said she struggled to find a qualified workforce in the village, as many people had left the country or become less interested in agriculture.

Another problem is the frequent electricity cuts. "Power shortages frustrated me as people of my village cannot afford a 24-hour working generator, and we had to organize the work according to power availability, focusing on the organization rather than product quality," she said.

Bechara says the primary reason for higher olive oil prices in Lebanon is soaring inflation, both in Lebanon and internationally. At the same time, she warns against using cheaper seed oils for cooking because "it is refined during its processing and kills all the nutrients."

"If you want to take care of your lands, you have to consider that the price of fertilizers and fuel have increased. It happened simultaneously when the purchasing power of Lebanese citizens decreased. So, if people used to afford three or four tins of olive oil a year, now they can barely afford one, which is not enough for a family," she said.

Edited by: Uwe Hessler