Why are extracted properties of food often cheaper than the whole food?

Question

For example, olive oil and olives, or orange juice and orange. Why is the extracted property of the food cheaper than the food itself?

In: Economics

Answer 1

Storage & transporation costs. Olive oil can sit at room temperature for a long time; olives spoil when not packaged properly. Orange juice and oranges, same. You’d have to refrigerate oranges and keep them safe from bugs and light for a while, including in transport. Orange juice, you can dehydrate the orange, transport the dry powder, mix it with water at the destination, and sell.