Italy’s New Lockdown Hits Olive Oil Sector, Again

Summary

New Covid-19 con­tain­ment mea­sures in Italy will impact the restau­rant and food pro­duc­tion sec­tors, with an esti­mated cost of €3.8 bil­lion. The new rules will sus­pend oper­a­tions at over 180,000 food venues, with the north­ern region of Lombardy fac­ing the most severe con­se­quences.

New Covid-19 con­tain­ment mea­sures announced by the Italian gov­ern­ment will once again impact the coun­try’s restau­rant and food pro­duc­tion sec­tors.

According to the lat­est esti­mates pub­lished by the farm­ers asso­ci­a­tion Coldiretti, the dam­age for the manda­tory clo­sure of restau­rants for the next month will cost the sec­tor €3.8 bil­lion ($4.47 bil­lion).

The new rules designed to com­bat the Covid-19 pan­demic directly involve the oper­a­tions of more than 180,000 restau­rants, pizze­rias, bars and pubs (the so-called Horeca sec­tor). The mea­sures are also expected to sus­pend oper­a­tions at more than 10,000 farm­houses.

The north­ern region of Lombardy, which has been hit hard by the virus, will face the most severe con­se­quences from the new con­tain­ment mea­sures. More than 51,000 food venues are located in the region.

“Within the areas of the national ter­ri­tory iden­ti­fied as red zones, all activ­i­ties related to the admin­is­tra­tion of food are sus­pended and that includes the farm­houses,” Coldiretti wrote in a note. ​“As a whole, we are talk­ing about more than half of the restau­rant activ­ity in Italy.”

While home deliv­ery and take away oper­a­tions will still be avail­able, those are viable options only for a small por­tion of the busi­nesses impacted by the new con­tain­ment mea­sures.

“The effects of the manda­tory clo­sure of the restau­rants rever­ber­ate through­out the whole agribusi­ness sec­tor, with can­cel­la­tions already hit­ting the sup­ply of prod­ucts, from wine and olive oil to meat and fish, to cold cuts, cheeses, veg­eta­bles and fruits,” Coldiretti said. ​“Food whose pro­duc­ers count on restau­rants as a very rel­e­vant mar­ket.”

For some sup­pli­ers, specif­i­cally of fish and wine, the restau­rant and hos­pi­tal­ity sec­tors are cur­rently the most impor­tant mar­ket for their prod­ucts.

A warn­ing about the con­se­quences of the new mea­sures has also come from Assitol. In a press release, the Italian Association of the Olive Oil Industry empha­sized how the Horeca cri­sis is already tak­ing its toll on the olive oil sec­tor.

“Up to this moment, domes­tic con­sump­tion and rel­e­vant exports allowed us to deal with the slow­ing sales in restau­rants, which account for a third of the inter­nal mar­ket,” Assitol pres­i­dent Anna Cane said. ​“The new halt makes us fear fur­ther neg­a­tive effects on a sec­tor that, even dur­ing these dif­fi­cult months, had gone ahead in cre­at­ing value.”

According to Coldiretti, Italian agribusi­ness exports have sus­tained the sec­tor in the first seven months of 2020, with a 3.5 per­cent increase in sales abroad — fig­ures that will not be seen again this year.

Coldiretti cited the lock­down enforced in Germany, where export num­bers had gone up seven per­cent in the last few months. Many of the most impor­tant mar­kets for Italian agribusi­ness exports are clos­ing down or severely lim­it­ing their activ­i­ties.

• Coldiretti
• Il Sole
• Assitol