1Brussels, 18/06/2012 Agence Europe – In the context of the Agriculture Council, Commissioner Dacian Ciolos met ministers from eight producer countries to discuss structural problems affecting the olive oil market He presented an action plan, which will be formally sent to all EU member countries during the EU management committee meeting on Tuesday 19 June
2The olive oil sector is suffering a fall in profitability, due to low price levels resulting from surplus supply, as well as an imbalance in the sector Olive oil prices have been at very low price levels for a long time now in Spain, extra virgin and virgin olive oil prices have been below activation thresholds since the beginning of 2012 Faced with this surplus, the only market instrument available is private storage assistance, which has been used on three occasions during this marketing year but has not yet had the desired effect on prices and appears to confirm that we are no longer in a period of a temporary economic crisis but rather, subject to underlying structural problems, explained the Commission
3The action plan is based on the following – quality and control – sector restructuring – subsidiary restructuring – promotion – competition with third countries The advantages of the European olive oil sector can be found in the quality of its products and the image of its brands The main areas in which action should be taken aim to – improve quality and control, through measures that protect and promote the perception of European olive oil brands, as well as measures that protect consumers and provide them with information – enhance sector competitiveness, by using all the potential offered by the common agricultural policy CAP reform and by mobilising all the different actors active in the sector
4Figures The olive oil market in the EU is dominated by Spain With regard to supply, Spanish production harvest estimates for 2011/2012 are 1,604,000 t historic record, which means a third bumper harvest year in a row This is exerting constant pressure on prices The Italian harvest is expected to be 400,000 t average harvest and that for Greece 300,000 t Total EU production in 2011/2012 is 24 million t + 9 compared to the average In the context of demand, Spanish exports are faring well + 6 and the domestic market has been stable over the first seven months of the year For Italy and Greece, domestic consumption forecasts and exports for the current marketing year remain stable 660,000 t and 228,000 t respectively for consumption and 312,000 t 90,000 t respectively for exports The low level of carryover stock in Italy 61,000 t and Greece 98,000 t should be noted while the end of year stock in Spain could reach a historic level of 636,000 t
At the beginning of the year, extra-virgin and virgin olive oil prices in Italy remained fairly stable at the respective levels of + 30 and + 6 higher than those in Spain This illustrates the deficit on the Italian market, while in Spain, extra-virgin and virgin olive oil prices have been between 97 and 99 of private storage activation prices for the past several months
Private storage Three adjudications on private storage aid were opened in the 2011/2012 marketing year 1 October 2011 44,337 t of virgin olive oil 44,050 t in Spain and 287 t in Portugal 2 February 2012 100,000 t of virgin olive oil in Spain 3 May 2012 100,000 t virgin and extra virgin olive oil In this final adjudication, a total quantity of 86,281 tonnes was accepted in the offers made on 7 June No other offer was submitted in Italy or Greece during these different adjudications LC/translfl
