Spain Seeks Self-Regulation for Olive Oil Sector

Summary

Spain is seek­ing approval from the European Union for self-reg­u­la­tion mea­sures in the olive oil indus­try to sta­bi­lize the mar­ket under the new Common Agricultural Policy, with dis­cus­sions set to take place at the next Council of Ministers of Agriculture sum­mit in Luxembourg. The mea­sures would allow Spain’s Interprofessional Olive Oil Organization to con­trol the amount of olive oil avail­able on the mar­ket and store sur­plus oil to pre­vent price drops caused by over­sup­ply.

Spain is seek­ing assur­ances from the European Union that self-reg­u­la­tion mea­sures intended to sta­bi­lize the country’s domes­tic olive oil mar­ket will be legal within the frame­work of the future Common Agricultural Policy (CAP), which comes into force in 2020.

The mea­sures would be sim­i­lar to those that already exist in the wine indus­try and will be dis­cussed at the European Union’s next Council of Ministers of Agriculture sum­mit, in Luxembourg.

The self-reg­u­la­tion mea­sures would allow Spain’s Interprofessional Olive Oil Organization to con­trol how much olive oil is avail­able on the mar­ket across the coun­try. Surplus olive oil would be stored appro­pri­ately and could be intro­duced to the mar­ket if demand were to rise higher than the cur­rent sup­ply.

“Our com­mit­ment is that the olive oil sec­tor has a mea­sure of this type,” Fernando Miranda, Spain’s Secretary General of Agriculture, said. “[To sta­bi­lize] long-term prices in the sec­tor, mar­kets and domes­tic con­sump­tion.”

Many olive oil indus­try ana­lysts in Spain have attrib­uted the unusu­ally low prices for oil to a cur­rent sup­ply that has far out­paced demand. Advocates of the mea­sures say that they would pre­vent the kind of severe price drops that have led to recent protests in Jaén.

“It is a tool demanded by the sec­tor,” a spokesper­son from Spain’s Ministry of Agriculture, Fisheries and Food, said, adding that the mea­sures could be imple­mented in time for the start of the 2019/20 har­vest sea­son.

Under cur­rent E.U. leg­is­la­tion pro­ducer orga­ni­za­tions and their asso­ci­a­tions are per­mit­ted to come to agree­ments on how much olive oil to allow into the mar­ket as well as store. These agree­ments on reg­u­lat­ing the olive oil sup­ply tend to be local and vary greatly from one pro­ducer orga­ni­za­tion to the next.

This lack of uni­for­mity is seen as an inef­fec­tive way to reg­u­late the over­all mar­ket, which the Interprofessional sees as nec­es­sary to pos­i­tively influ­ence prices.

“While some pro­duc­ers with­draw prod­uct from the mar­ket, oth­ers [who did not have to do so] could ben­e­fit from the recov­ery of prices,” Cristóbal Gallego Martínez, the pres­i­dent of the Council of Olive Oil Cooperatives of Andalusia, said. ​“It is essen­tial to enforce the mea­sure so that it has its effects on the mar­ket and the sec­tor as a whole.”

“It is vital that the [Interprofessional’s] mea­sure is manda­tory because, oth­er­wise, the objec­tive pur­sued will not be achieved, which is noth­ing other than to sta­bi­lize the mar­kets and avoid the price swings,” Gallego Martínez added.

Several of Spain’s olive oil orga­ni­za­tions met in Jaén ear­lier this week to dis­cuss the idea of self-reg­u­la­tion. The orga­ni­za­tions all unan­i­mously agreed that self-reg­u­la­tion was the way for­ward, but did not nec­es­sar­ily agree on how it should be imple­mented.

“For now, I can tell you that the indus­try does not agree with mod­i­fy­ing the for­ma­tion of prices, through sup­ply and demand,” Rafael Pico Lapuente, the direc­tor of the Spanish Association of Olive Oil Exporting, Industry and Commerce (Asoliva), told Olive Oil Times.

The Interprofessional and Spain’s many other olive oil orga­ni­za­tions will need to wait until the European Commission rules on whether the pro­posed self-reg­u­la­tion mea­sures are legal. Once the deci­sion is made, the sec­tor can begin the process of deter­min­ing how the mea­sures will be imple­mented.

• Ministry of Agriculture, Fisheries and Food


• Agroinformacion