`Commissioner Says He Will Analyze Spain's Call for Private Storage Aid - Olive Oil Times

Commissioner Says He Will Analyze Spain's Call for Private Storage Aid

Mar. 18, 2011
Julie Butler

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As thou­sands of Spain’s olive oil pro­duc­ers took to the streets today in protest over pal­try prices, the European Commission agreed to at least ana­lyze their case for the imme­di­ate pro­vi­sion of pri­vate stor­age aid.

Today’s protests con­cen­trated in Jaén, the world cap­i­tal of olive oil pro­duc­tion, and indus­try groups say every fort­night a protest will be held in other loca­tions around the coun­try until the EC agrees to sub­si­dize the vat stor­age of sur­plus olive oil until pro­ducer prices improve.

European Commissioner for Agriculture Dacian Cioloş said yes­ter­day that between now and an EC man­age­ment coun­cil meet­ing on April 13, he would closely exam­ine Spain’s case. However, he reit­er­ated that the sit­u­a­tion still did not appear to meet the con­di­tions required for the bulk stor­age pay­ments. Firstly, olive oil prices in Spain were higher than the trig­ger lev­els and sec­ondly, there was no proof of seri­ous mar­ket dis­tur­bance.

He was speak­ing after a meet­ing of EU agri­cul­ture min­is­ters dur­ing which Greece, Italy, France, Cyprus, Portugal and Poland sup­ported Spain’s call for the stor­age aid.

Last month, Cioloş rejected an ear­lier such bid by Spain, say­ing that the coun­try’s prob­lem lay with an imbal­ance of power held by dis­trib­u­tors and that the aid was designed to address cycli­cal, not struc­tural, prob­lems.

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EC sources said that this time, hav­ing seen that Spain was not the only coun­try with the prob­lem, Cioloş had not closed the door” to the idea of pro­vid­ing aid but nei­ther had he left it very wide open.” While Greece was also suf­fer­ing prices low enough to trig­ger pri­vate aid, the cause was regarded as struc­tural and thus also did not meet the pri­vate aid cri­te­ria, they said.

According to the EC, olive oil prices in Spain last year were between six and thir­teen (in the case of EVOO) per­cent above the thresh­olds for pri­vate stor­age aid.

The aver­age price of oil fell to €1.84 ($2.60) per kg in Spain last month, but the thresh­olds for pri­vate stor­age – set in 1998 – are €1.77 ($2.39) for extra vir­gin olive oil, €1.71 ($2.30) for vir­gin olive oil and €1.52 ($2.05) for lam­pante oil, prices far removed from cur­rent pro­duc­tion costs.
Spain’s Agriculture Minister Rosa Aguilar hailed Cioloş’s agree­ment to study the sit­u­a­tion as a first step”. Government sources said that the EC’s com­mit­ment to study Spain’s appli­ca­tion would itself prob­a­bly boost prices in com­ing weeks.

Francisco Reyes, sec­re­tary gen­eral of the PSOE (Spain’s rul­ing party) in Jaén, said while stor­age aid should be pushed for, it would not address pro­duc­ers’ fun­da­men­tal prob­lem – their lack of cohe­sion. In a clear ref­er­ence to the dom­i­nance of Spain’s highly con­cen­trated food dis­tri­b­u­tion sec­tor, he said it was unten­able for the cur­rent sit­u­a­tion to con­tinue in Andalusia where there are 300 sell­ing oil and only three buy­ing.”

Meanwhile, COAG, one of Spain’s largest agrar­ian unions, esti­mated that more than 12,000 olive grow­ers and oil pro­duc­ers had par­tic­i­pated in today’s protests. Further demon­stra­tions will be held in Córdoba (April 1), Toledo (April 15) and Mérida (April 29).

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