The Andalusian regional government has allocated 40 million euros ($56.6m) to provide short-term loans so its olive oil producers can avoid selling at a loss.
The funds were announced Thursday by Clara Aguilera, Andalusia’s Minister of Agriculture and Fisheries, who also ruled out approving any more designations of origin within her jurisdiction. She said that half the existing ones – “to be generous” – weren’t improving profitability for the sector, reported EFEAgro.
And Aguilera said she won’t be going back to Brussels to plead for private storage aid. Instead she will focus on ensuring that the current level of E.U. subsidies for Andalusia’s olive oil sector – €836.15 m ($1.18b) in 2010 – is at least maintained post-2013. These Common Agricultural Policy (CAP) payments currently formed about 40 percent of the income of Andalusian olive oil producers, she said.
Aguilera was speaking after participating in the “Future of the Olive Oil Sector” debate in Seville. On the new short-term loan scheme, she said the capital injection would help Andalusia’s producers – who make 80 per cent of Spain’s output – cover their day-to-day running costs and thus avoid feeling pressed to sell their oil at any price.
As the current production cycle draws to a close, she said that when harvesting cranks up in October, the sector had to do its utmost to avoid repeating the same problems with lack of profitability as it had suffered in the last three seasons.
As for the issue of EU private storage aid – payments to producers who keep their oil off the market until prices improve – she said there was no point pressing the issue as “we know we don’t meet the requisites of European Commissioner for Agriculture Dacian Cioloş.” However, as part of the CAP reform she would push for changes to the private storage aid provisions and explore other crisis management tools.
Andalusia already has 11 – soon to be 12 – of what Spain calls denominations of origin (D.O.s), plus the new Protected Geographical Indication (PGI) for Jaén, Aguilera said her ministry had “closed the door to the creation of new denominations for olive oil.” She stressed that it had made a big effort both publicly and privately to empower the existing ones and it was now time to “realize a return.”
As for the sector’s main priorities, they were professionalism, promotion and to demand quality without compromise, Aguilera said.