Spain’s Ministry of Agriculture has ordered farmers to set aside 12% of the olive oil produced for storage until the end of September 2027. The decision was made amid a forecast of a large olive harvest: olive oil production in the country could rise by 23% this season, to 1.6 million tonnes. As Fortune reports, this would be the fourth-largest harvest in history.
Farmers must store part of the oil on their own farms or at third-party storage facilities. The ministry aims to temporarily keep 188,000 tonnes of olive oil off the market. The agency said the measure is intended to ensure profitability for farmers, protect buyers’ interests, and add stability to the market.
The current harvest season began in September. Favorable weather in spring, according to the publication, may offset the effects of drought and heat in previous years, when olive production remained low. The European Union allows olive oil supplies to be withheld if this does not lead to excessive market distortion.
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Expectations of greater supply have already affected product prices. At olive mills in Andalusia last weekend, the average price was €2.93 per kilogram, approximately 15% lower than about two months ago.
Industry representatives criticized the attempt to support prices, stressing that the olive oil market is global, while the order applies only to Spanish producers. Kyle Holland, a senior analyst at Expana, also noted that olive oil deteriorates during storage and may no longer meet the extra virgin category after just a few months. According to him, major buyers already have substantial stocks, so storing part of the production may not have an immediate impact on prices.
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