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Producers in Peru Concerned About Subsidized Olive Oil Imports

Oct. 8, 2010
Sarah Schwager

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By Sarah Schwager
Olive Oil Times Contributor | Reporting from Buenos Aires

An increase in olive oil imports in Peru could severely affect the national indus­try, accord­ing to the country’s Pro Olivo Association.

The pri­vate orga­ni­za­tion, which rep­re­sents 90% of Peru’s olive exports and all of the nation’s olive oil pro­duc­ers’ deriv­a­tives, says local pro­duc­ers are very con­cerned about the effect that the emer­gence of sub­si­dized Spanish olive oil onto the Peruvian mar­ket will have on them.

The Association is apply­ing to Peru’s National Institution for Competition Defense and Intellectual Property Protection (Indecopi) for an exten­sion of
coun­ter­vail­ing duties on Spanish olive oil imports.

Pro Olivo Association General Manager Edgard Salas told Agro Negocios Peru that with­out para-tar­iff bar­ri­ers, imports have shot up since 2008. He says this could lead to the clo­sure of new pro­cess­ing plants recently set up in the South American nation.

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He hopes pro­posed invest­ments in 400 hectares of olive groves, and poten­tially up to 1000 hectares, in the south of Peru could put a halt to sub­si­dized olive oil imports.

Peru’s olive indus­try is small even in com­par­i­son with those coun­tries con­sid­ered to be low pro­duc­ers. The coun­try holds 9,500 hectares of olive groves (23,500 acres), 7,500 of which pro­duce olive oil. There are only four or five Peruvian com­pa­nies that are big enough to be able to sell olive oil at a national level.

Yet Pro Olive Association Founder Alfredo Gonzalez says imports have grown from 8,000 liters of olive oil to 29,000 liters in just two years, with Peruvian olive oil exports increas­ing 32% last year com­pared to 2008 and again 134% in the first half of this year, while vol­ume grew 53%.

This is largely thanks to the high qual­ity of the olive oil, which is said to con­tain very few preser­v­a­tives, with Peruvian pro­duc­ers con­tin­u­ally work­ing to bet­ter the qual­ity by reduc­ing the degree of free fatty acid­ity in the oil.

Increased demand from Canada, Japan and Colombia con­tributed to the rise as well as the intro­duc­tion of Peruvian olive oil into the Australian market.

The issue of sub­si­dized imports was quelled mid-last year when Indecopi launched an inves­ti­ga­tion to deter­mine whether Spain and Italy should be imposed coun­ter­vail­ing duties on olive oil imports.

The Pro Olivo Association says an exten­sion of the sur­charge is jus­ti­fied as it has already demon­strated to Indecopi that Spanish olive oil is sub­si­dized, but says so far it has not received a response.

Every time we sell less olive oil on the Peruvian mar­ket, it affects Peru’s olive oil indus­try, which is con­cen­trated in Tacna (a region located in south­ern Peru),” Mr. Gonzalez said.

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