Spain has launched an unprecedented intervention in its olive oil market, removing 12% of this year’s production to prevent prices from collapsing. The scheme, activated on Friday, will store around 188,000 tonnes of olive oil for release in years with poor harvests. The EU-backed measure aims to stabilize prices, which have been highly volatile in recent years.
Farmers are currently receiving around €3 per kilo for extra virgin olive oil, while production costs on many farms are close to €5. The price squeeze has worsened as farm diesel and fertilizer costs have soared. Agriculture Minister Luis Planas defended the move, stating it would ensure 'price stability at source, fair pay for our producers and reasonable prices for consumers.' Farmers’ organizations have widely welcomed the intervention.
However, olive oil bottlers and refiners are opposing the measure. Their association, Anierac, argues that the withdrawal is 'disproportionate' and could harm the competitiveness of Spanish olive oil. The bottlers, along with exporters’ association Asoliva, advocate for a long-term strategy to boost consumption and expand international markets. Spain’s competition watchdog, the CNMC, also expressed concerns, warning that restricting supply could lead to price increases and reduce incentives for quality improvement.