With Spain, Europe's leading producer, reporting one of its worst olive oil harvests in years and wholesale prices up by 50 percent, the UK consumer looks set to experience a major increase in both branded and own label olive oil prices.

As a result of a drought in Spain during the key 2012 growing season, the country's 2013 crop forecast of 700,000 tonnes is more than 60 percent down on the previous year's figure. As a result, mill prices (the bulk price charged for olive oil by the pressing plants) has risen by 50 percent since July 2012.

Other olive oil–producing countries, including Italy, Greece Turkey and Tunisia, have had their own drought problems and will not be able to make up the shortfall from Spain, which represents 60 percent of Mediterranean production.

Such shortages and wholesale prices increases are too great to be consolidated by the olive oil brands and own label suppliers so price increases are clearly imminent. The key question will be if these will match the up to 50 percent increases paid for wholesale olive oil.

Walter Zanré, managing director of Filippo Berio UK, Britain's leading olive oil brand, said, "Although we don't control the retail prices paid by the consumer, the drought in Spain will certainly have an impact on the prices paid by consumers in the UK and throughout Europe. In the short term there will certainly be price increases for both branded and own label olive oils. Olive oil is a natural product, so just like this year's experience in the wine trade, we are at the mercy of supply variations and price increases as a result of the weather."