The European Commission has approved private storage aid for olive oil in the EU.The scheme should help alleviate the market imbalance between supply and demand, and stabilise prices.
Important stocks at EU level and consecutive good harvests have created an imbalance between supply and demand on the EU olive oil market, resulting in a price decrease. In view of this particularly difficult market situation, the European Commission adopted today private storage aid for virgin olive oils.
Due to the excess in supply following harvest 2018-19, prices over the last few months in the Spanish, Greek and Portuguese markets have been particularly low. For instance, the price of Spanish extra virgin olive oil reported mid-October was 33% below the five-year average. Similarly, the price of Greek virgin olive oil was 13.5% lower than the five-year average.
The exceptionally high stocks at EU level, estimated at 859 000 tonnes for 2018-19 (88% of which in Spain), combined with an average production expected for 2019-20 threatens to keep the EU olive oil market under pressure.
The private storage scheme will help alleviate the pressure and contribute to rebalance the market.
Phil Hogan, Commissioner for Agriculture and Rural Development said “In the past months, the olive oil market has been going through serious market imbalance and I’m proud to say that once again the Common Agricultural Policy is here to support our farmers and producers. Thanks to our market measures, the private storage aid adopted today will help stabilise the market and prevent further damages to the sector.”
The scheme will operate through a tendering procedure for a maximum of 4 periods to allow for flexibility and measured market management. The aid will be granted to oils in bulk of the different types of virgin olive oils: extra virgin, virgin and lampante olive oil. More