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The Spanish government has intervened in the domestic olive oil market by ordering producers to withhold 12% of their new production from sale until September 2027. This regulatory move, published in the Official State Gazette, is intended to prevent a price collapse following a projected large harvest, though its impact on consumer retail prices remains uncertain.
The mandate requires every olive mill across Spain to store 12% of their declared production starting from November 2026. While mills are free to decide which category of oil to sequester and where to store it—whether in their own facilities or third-party warehouses—the regulation excludes production from October. These reserves must remain off the market until the conclusion of the current commercial campaign.
The government’s primary objective is to limit supply to stabilize the market and ensure farmers do not have to sell their yields below production costs. However, the National Commission on Markets and Competition (CNMC) has expressed reservations. In its assessment, the competition watchdog warned that artificially restricting supply could drive up consumer prices and negatively affect the variety and quality of olive oil available to the public.
Market data indicates that while olive oil prices at the source have begun to decline, retail prices in supermarkets have remained stubbornly high, often exceeding €4 per litre. This intervention adds a layer of complexity for consumers hoping for immediate relief at the checkout.
The decision also carries implications for international markets, particularly the United Kingdom. In 2025, the UK imported nearly 30,000 tonnes of Spanish virgin olive oil, representing approximately 62% of its total imports in that category. By tightening domestic supply, Spain’s storage mandate could potentially impact availability and pricing for British buyers.
The government maintains that the measure is a necessary safeguard against market destabilization. Authorities will continue to monitor production figures and have the power to adjust the storage percentage as the season progresses.
Source: Euro Weekly News