E.U. Green Lights €100M Subsidy for Italian Olive Millers

Summary

The European Commission has approved €100 mil­lion in sub­si­dies for Italian millers to upgrade machin­ery and improve com­pet­i­tive­ness, par­tic­u­larly aimed at smaller mills strug­gling to access loans for tech­no­log­i­cal upgrades and energy effi­ciency. The funds are part of a broader Agriculture 4.0 ini­tia­tive to mod­ern­ize the sec­tor, with a sig­nif­i­cant por­tion likely going to millers in Puglia, the largest olive oil-pro­duc­ing region in Italy.

Many Italian millers will have eas­ier access to funds needed to ren­o­vate their mills and upgrade machin­ery after the European Commission has given the go-ahead to €100 mil­lion in sub­si­dies.

Originally ear­marked by the Italian gov­ern­ment last spring, the money is meant to make mills more com­pet­i­tive at a global level and envi­ron­men­tally sus­tain­able.

According to the lat­est data pub­lished by Ismea, the pub­lic agency for ser­vices to the agri­cul­tural mar­ket, more than 4,000 olive mills oper­ate in the coun­try. While many com­pa­nies process large vol­umes of olives, smaller mills in the coun­try­side gather olives from small grow­ers.

Due to their size, many milling busi­nesses have more dif­fi­cul­ties access­ing loans to invest in tech­no­log­i­cal upgrades and incor­po­rate the most mod­ern equip­ment into their milling process.

This has been exac­er­bated by ris­ing energy costs due to the Russian inva­sion of Ukraine and the country’s severe drought, which has led to low olive yields across the coun­try.

As the har­vest sea­son gets under­way in many areas, a sig­nif­i­cant pro­duc­tion drop is expected to impact both large and small millers directly. Yields are so low in some regions that sev­eral oper­a­tors delayed their sea­sonal open­ing. Elsewhere, millers are rais­ing the costs of olive pro­cess­ing.

According to the Italian Ministry of Agriculture, Food and Forestry, projects financed with the new sub­si­dies should reduce energy con­sump­tion and lower their envi­ron­men­tal impact.

Some of the funds will be explic­itly directed to re-use oper­at­ing waste for energy pro­duc­tion and the instal­la­tion of clean energy sources.

Still, the fun­da­men­tal aim of the new mea­sure is to fur­ther improve the final prod­uct qual­ity by adopt­ing new tech­nolo­gies and machin­ery.

In the next four years, millers will be able to present their ren­o­va­tion plans to the min­istry, which will cover up to 50 per­cent of the cost with new funds.

Coldiretti Puglia, a farm­ers’ asso­ci­a­tion, lauded the European Commission’s deci­sion to green-light the sub­si­dies.

“It is an oppor­tu­nity for the whole pro­duc­tion chain, which is worth €1.2 bil­lion [for grow­ers] and €3 bil­lion [for millers and bot­tlers],” said Savino Muraglia, pres­i­dent of the asso­ci­a­tion.

A sig­nif­i­cant por­tion of the new funds will prob­a­bly go to millers in Puglia, the largest olive oil-pro­duc­ing region in Italy, where olive groves cover one-fourth of its agri­cul­tural lands.

In the next few weeks, the spe­cific pro­ce­dures for access­ing the new funds should be final­ized.

The new funds are part of a broader Agriculture 4.0 ini­tia­tive, which will see €400 mil­lion invested into the sec­tor by 2023.

Agriculture 4.0 involves imple­ment­ing pre­ci­sion agri­cul­tural tech­nolo­gies, includ­ing more dig­i­tal­iza­tion and tar­geted irri­ga­tion, fer­til­iza­tion and pes­ti­cide appli­ca­tion.

According to the millers, the sec­tor is pay­ing the con­se­quences of a rapidly chang­ing inter­na­tional mar­ket. At the same time, extreme weather events and the spread of Xylella fas­tidiosa in Puglia con­tinue to harm grow­ers and pro­duc­ers.

• Andria Live