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EU Aid Not Helping Croatians, Official Says

The third tendering period for European Union producers seeking private storage aid for olive oil has just opened. However, one Croatian olive oil official argues that the aid does not help producers in small countries.

Jan. 27, 2020
By Karmela Hromin

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A new period of ten­der­ing pro­ce­dures con­nected to the Euro­pean Com­mis­sion’s olive oil stor­age efforts began in Croa­tia and the rest of the Euro­pean Union on Jan­u­ary 22.

Stor­age aid for vir­gin oils was approved by the Euro­pean Com­mis­sion in late 2019 to bal­ance the sup­ply and demand of olive oil after prices decreased through­out the trad­ing bloc.

These ten­ders are not appro­pri­ate to cur­rent con­di­tions in the Croa­t­ian oil mar­ket because even the min­i­mum quan­tity that can be stored is unat­tain­able to Croa­t­ian oil pro­duc­ers.- Jakša Najev, mem­ber of Croa­t­ian Com­mit­tee for Olives and Olive Oil Pro­duc­tion

Spain, Por­tu­gal and Greece have seen prices drop to unex­pected lows, which have mainly been attrib­uted to good har­vests in the E.U. over the past two years, accu­mu­lat­ing olive oil stocks through­out the bloc and stag­nant con­sump­tion.

The con­tin­ued accu­mu­la­tion of stocks in Spain, the world’s largest olive oil pro­ducer, has also threat­ened to make the cur­rent mar­ket imbal­ance even worse.

See more: Olive Oil Prices News

All of this has prompted the Euro­pean Com­mis­sion to try and pre­vent fur­ther dam­age to the sec­tor.” The aid for vir­gin oil and lam­pante has been set at €0.83 ($0.92) per ton per day, and the oil has to be stored for a min­i­mum of 180 days.

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The low­est quan­tity of oil eli­gi­ble for aid is 50 tons, which has led to skep­ti­cism among Croa­t­ian indus­try insid­ers regard­ing the suit­abil­ity of such aid mea­sures. Over­all, Croa­tia pro­duced 3,500 tons of olive oil in the 2019/20 crop year, accord­ing to the lat­est fig­ures pub­lished by the Inter­na­tional Olive Coun­cil, and many of the coun­try’s pro­duc­ers are quite small.

Jakša Najev, a mem­ber of the Com­mit­tee for Olives and Olive Oil Pro­duc­tion at the Cham­ber of Agri­cul­ture in Croa­tia believes no Croa­t­ian olive oil mak­ers will apply for the aid.

These ten­ders are not appro­pri­ate to cur­rent con­di­tions in the Croa­t­ian oil mar­ket because even the min­i­mum quan­tity that can be stored is unat­tain­able to Croa­t­ian oil pro­duc­ers,” he said. Fifty tons would be about one-third of what one of the largest Croa­t­ian mak­ers pro­duce in a year.”

Fur­ther­more, most of Croa­t­ian pro­duc­ers make extra vir­gin oil, and Euro­pean aid was only focused on stor­ing lower qual­ity oils – vir­gin oil and lam­pante,” he added. Extra vir­gin oils are not eli­gi­ble for stor­age, although the Euro­pean Com­mis­sion at first announced they would be. These mea­sures will be use­ful only in Spain, where there is a sur­plus of oils. We prac­ti­cally have a short­age.”

Najev has pre­vi­ously stated that Croa­t­ian oil pro­duc­ers have over the years made a mis­take of slid­ing into a sort of elit­ism, with vir­gin olive oil being the only inter­est point, fueled by pref­er­ences of local experts, which in turn reduced the pub­lic inter­est for other types of oil.

He believes branch­ing out into pro­duc­ing more lam­pante and vir­gin oils would bring oppor­tu­ni­ties for enter­ing new mar­kets.

The final period of stor­age aid ten­ders in Croa­tia, Cyprus, France, Greece, Italy, Malta, Por­tu­gal, Slove­nia and Spain will open on Feb­ru­ary 20, 2020.





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