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Abstract
Consumption patterns of olive oil have changed over recent years influencing the supply chain. The consumption
has increased in countries where olive oil is not part of the traditional diet as for example Germany and the
UK, where the average consumption grew by 11 and 13% respectively during the period 1995-2003. The opening of
new non-traditional markets has shifted exports and re-structured the supply chain. Mediterranean countries have
been the traditional suppliers of olive oil with the EU Mediterranean Member States being the main exporters and
with the non-EU Mediterranean countries trying to gain market shares in the EU markets in an attempt to benefit
from the preferential access due to the Barcelona Agreement. This paper tries to identify which factors influenced
olive oil demand of non-traditional consumers using Germany and the UK as case studies with the help of a gravity
model. The results of the random effects models corrected for serial correlation and heteroskedasticity indicate that
the Barcelona Agreement has boosted the non-EU Mediterranean exports to Germany and the UK while olive oil
exports are positively related to direct marketing strategies and tourism, implying that these factors have the largest
impact on the olive oil exports from producing countries and consequently on the overall supply chain.