Why Spain is taking 188,000 tonnes of olive oil off the market

The world’s biggest olive oil producer is holding back 12% of its output from November to stop producer prices falling further. It’s the first time Spain has used the measure, which is expected to keep about 188,000 tonnes off the market until the end of September 2027.

Spain has ordered olive oil mills to store 12% of their production from November 2026 to regulate supply by temporarily taking some oil off the market.

The measure, published on Friday in Spain’s Official State Gazette (BOE), applies to the output each mill reports producing each month. Mills can store the oil either at their own facilities or at a third-party site.

The Directorate-General for Agricultural Production and Markets said the measure excludes output reported for October and earlier months. The oil put into storage must stay off the market until 30 September 2027, the end of the season.

The decision comes as Spain expects a strong harvest and already has high stocks. According to the resolution, opening stocks stood at 357,040 tonnes, while production is forecast to reach 1,602,596 tonnes.

The expected supply could push producer prices down further. Spanish producers were getting about €3 a kilo for extra virgin olive oil in early November, down from around €4 a kilo a year earlier, according to El País.

The government can take oil off the market when opening stocks and forecast output together are at least 20% above the average for the previous six seasons. This season’s figures met that condition. The agriculture ministry expects about 188,000 tonnes to be taken off the market.

Spain is the world’s largest olive oil producer and exporter, according to its agriculture ministry. The ministry estimates that Spain accounts for about 45% of global production and 70% of EU production, though those shares vary by harvest.

Olive oil prices rose sharply after drought and heatwaves hit harvests in recent years, then fell as production recovered.

Dcoop and Acesur agree to buy Deoleo Holding

The government’s decision coincides with a major deal in the sector that would bring three big names in olive oil together. Spanish companies Dcoop and Acesur have agreed to acquire Deoleo Holding, a subsidiary of listed olive oil group Deoleo.

Deoleo describes itself as the world’s largest branded olive oil company and owns brands <a href="https://warsaw.today/delta-new-york-nairobi-kenya-830-roundtrip-including-all-taxes/” title=”Delta: New York – Nairobi, Kenya. $830. Roundtrip, including all Taxes”>including Carbonell and Hojiblanca.

The deal values all of Deoleo Holding at €520mn, including debt. The agreement covers a 91.99% stake, including Deoleo’s entire 50.99% holding.

If the remaining shareholders join the sale as expected, the buyers could acquire 100%. Acesur said the two buyers plan to take equal stakes. The deal requires regulatory approvals and a vote by listed Deoleo’s shareholders.

Deoleo shares closed 21.1% lower on Thursday after the announcement. The deal followed months of negotiations and a rival bid from Spain’s Migasa and Italy’s Coricelli.

Source: www.euronews.com