`USITC Holds Hearing on Olive Oil Market Conditions - Olive Oil Times

USITC Holds Hearing on Olive Oil Market Conditions

By Curtis Cord
Dec. 6, 2012 15:11 UTC

The United States International Trade Commission held a pub­lic hear­ing in Washington, D.C. Wednesday, part of an inves­ti­ga­tion into the con­di­tions of com­pe­ti­tion between American olive oil pro­duc­ers and major for­eign sup­pli­ers.

Facing the com­mis­sion­ers, who are appointed by the U.S. President for nine-year, over­lap­ping terms, twenty wit­nesses includ­ing pro­duc­ers, chemists and importers tes­ti­fied on mat­ters rang­ing from sub­si­dies and tar­iffs to olive oil qual­ity and fraud.

Executives from the largest American olive oil pro­ducer, California Olive Ranch, began the pro­ceed­ings by describ­ing how the world’s largest export mar­ket for olive oil has been an unreg­u­lated mess, with uneth­i­cal for­eign pro­duc­ers reg­u­larly under­cut­ting domes­tic sup­pli­ers with sub­stan­dard prod­ucts.

Substantial European gov­ern­ment sub­si­dies, inef­fec­tual qual­ity stan­dards, com­bined with ram­pant fraud and mis­la­bel­ing have pre­vented the U.S. olive oil indus­try from real­iz­ing its poten­tial,” said California Olive Ranch Vice President Adam Englehart.

John Sessler (left), chair­man of the American Olive Oil Association, pre­pared to tes­tify Wednesday at the United States International Trade Commission in Washington

Author Tom Mueller, whose 2011 Extra Virginity: The Sublime and Scandalous World of Olive Oil” described a cul­ture of fraud in the olive oil world dat­ing back to antiq­uity, placed much of the blame with U.S. author­i­ties” who have failed to enforce exist­ing rules and, repeat­ing charges made in his book, cer­tain inter­na­tional olive oil orga­ni­za­tions” for pro­tect­ing shady prac­tices by pre­serv­ing the sta­tus quo.

Throughout the tes­ti­monies the com­mis­sion­ers lis­tened atten­tively to the wit­nesses and asked ques­tions. Before ques­tion­ing the first panel, Commissioner Shara L. Aranoff, a Maryland Democrat appointed by George W. Bush, said I’m a bit afraid my chil­dren will find out what I’ve been feed­ing them all these years.”

Despite the early tone, the topic of olive oil adul­ter­ation did not dom­i­nate the hear­ing, as the com­mis­sion­ers and their staff asked ques­tions that might help frame the issues within the con­text of global trade rela­tions and reg­u­la­tory real­i­ties.

Conspicuously absent was any­one from the International Olive Council (IOC) which was a fre­quent sub­ject of dis­cus­sion, with com­mis­sion­ers won­der­ing aloud whether the Madrid-based inter­gov­ern­men­tal orga­ni­za­tion had a stand on a cer­tain point, or an answer to a ques­tion posed. Executive Director Jean-Louis Barjol could not be reached for a com­ment on why an IOC rep­re­sen­ta­tive was not present for the hear­ing.

American pro­duc­ers, includ­ing California Olive Ranch, have formed a new group, the American Olive Oil Producers Association (AOOPA) to orga­nize their efforts. Executive Director, Alexander J. Ott, said the group rep­re­sented more than 90 per­cent of domes­tic pro­duc­tion.

Ott spent much of his five-minute allot­ment — and more time dur­ing direct ques­tion­ing — stress­ing the nonex­is­tence of any fed­eral mar­ket­ing order for olive oil, and describ­ing the long, drawn-out process to get one adopted. A draft of a mar­ket­ing order was dis­cussed at a con­fer­ence of California pro­duc­ers last January, and leaked to Olive Oil Times. Since then, its prospect has caused great con­cern in Europe where politi­cians have decried it as a bar­rier to trade.

Within the House Farm Bill, is a pro­vi­sion to include olive oil in the so-called Section 8e list of com­modi­ties reg­u­lated by domes­tic mar­ket­ing orders. Ott called that ini­tia­tive putting the cart before the horse.”

There is no mar­ket­ing order,” Ott stressed repeat­edly through­out the day, adding the hys­te­ria over a poten­tial fed­eral mar­ket­ing order is some­what humor­ous.” Consuming pre­cious time at the hear­ing to leave lit­tle doubt that the AOOPA is sim­ply work­ing on such an order, but has not for­mally pro­posed one, was seen by at least one observer as an effort to guide inves­ti­ga­tors to con­sider all options in its report to the House Ways and Means Committee on August 12, 2013.

University of California at Davis chemist Selina Wang and Rodney Mailer from Charles Sturt University in Australia spoke about the newer chem­i­cal meth­ods, called PPP and DAGs tests, stat­ing that cur­rent, widely-used pro­to­cols were insuf­fi­cient to accu­rately deter­mine olive oil qual­ity. The exist­ing restric­tive stan­dards dis­crim­i­nate against good qual­ity olive oil but do noth­ing to pre­vent unac­cept­able prod­ucts being sold in our super­mar­kets,” said Mailer.

Testifying on behalf of major importers were the chair­man of the North American Olive Oil Association (NAOOA) John Sessler, and Executive Vice President Eryn Balch, who called for enforce­ment of exist­ing inter­na­tional stan­dards for olive oil grades.

Balch blamed sub­jec­tive sen­sory test­ing” for the highly pub­li­cized results of a 2010 University of California, Davis study that found most imported olive oils in California super­mar­kets sub­stan­dard, and she described the broad range of prod­ucts and grades NAOOA mem­bers pro­vide to sat­isfy the grow­ing American demand for olive oil.

Frank Patton, pres­i­dent of Pompeian, Inc., a major importer based in Maryland, told the panel his com­pany had been proac­tive in qual­ity cer­ti­fi­ca­tion, becom­ing the one (and only) par­tic­i­pant in a USDA qual­ity mon­i­tor­ing pro­gram recently extended to include olive oil. Calling the pro­gram expen­sive,” Patton nev­er­the­less said par­tic­i­pat­ing in the new pro­gram was a pos­i­tive step for Pompeian, and a pos­si­ble model for oth­ers.


The hear­ing was the biggest stage yet for a fledg­ling U.S. olive oil indus­try that has its sights set on more than the two per­cent of domes­tic demand it cur­rently sup­plies. Stretching beyond farm­ers’ mar­kets and spe­cialty stores to broader dis­tri­b­u­tion, the new indus­try’s lead­ers are find­ing it hard to com­pete with sub­si­dized European farms and some exporters who occupy super­mar­ket shelves with lower qual­ity, often mis­la­beled prod­ucts.

European exporters and their trad­ing part­ners in the U.S. view the USITC olive oil inves­ti­ga­tion as a threat to their exist­ing ways of doing busi­ness that might even­tu­ally lead to more reg­u­la­tion, costly qual­ity audits and, pos­si­bly, higher tar­iffs in what has become their most lucra­tive export mar­ket.

Transcripts of the Witness Testimonies at the USITC Hearing


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