The European Commission (EC) adopted private storage aid for virgin olive oils on 11 November to prop up prices hit by an oversupply of oil.

Due to the excess in supply following the 2018/19 harvest, prices over the last few months in the Greek, Portuguese and Spanish markets had been particularly low, the EC said.

The price of Spanish extra virgin olive oil reported in mid-October, for example, was 33% below the five-year average. Similarly, the price of Greek virgin olive oil was 13.5% lower than the five-year average.

“The exceptionally high stocks at EU level, estimated at 859,000 tonnes for 2018/19 (88% of which is in Spain), combined with an average production expected for 2019/20, threatens to keep the EU olive oil market under pressure,” the EC said.

The private storage scheme would help alleviate the pressure and contribute to rebalance the market.

The scheme would operate through a tendering procedure for a maximum of four periods to allow for flexibility and measured market management. The aid would be granted to oils in bulk of the different types of virgin olive oils: extra virgin, virgin and lampante olive oil, the EC said.

For private storage aid to have an effect, the oils should stay in storage for a minimum of 180 days and the minimum quantity per tender should be 50 tonnes.

The EC said tenders could only be submitted in Croatia, Cyprus, France, Greece, Italy, Malta, Portugal, Slovenia and Spain.