Italy seeks EU agricultural reserve support as olive oil prices and margins fall
Italy has asked for EU agricultural reserve funds to support an olive oil sector facing falling producer prices, high costs and rising inventories. Italian stocks reached about 233,000 tonnes in July 2026, more than 40% above the level recorded a year earlier.
Rome asks Brussels for emergency support
Italy has asked the European Union to activate its agricultural reserve in response to what Rome describes as growing difficulties in the olive oil sector. According to Eunews, the Italian government submitted a document requesting that the issue be discussed at the Agriculture Council meeting on 28 and 29 September. The proposed funding would support exceptional measures intended to address severe market disruption and provide rapid assistance to operators.
The agricultural reserve is a Common Agricultural Policy instrument designed to respond to market crises and exceptional events. It has an annual allocation of at least €450 million. The request does not specify how much funding Italy is seeking or what individual measures it wants financed.
Producer prices fall while inventories rise
Rome identifies three connected pressures: persistently falling producer prices, increasing inventories and high production costs. Italian extra virgin olive oil prices began declining in the final months of 2025 after reaching exceptionally high levels in 2023 and 2024. The fall accelerated during 2026 and exceeded 50% in some major Italian production areas, according to the government document cited by Eunews.
The price reversal has reduced the revenue earned from selling oil, while growers and processors continue to face expensive production inputs. The document says operators are reporting prices that are not sufficiently remunerative and growing liquidity difficulties. Higher energy, fuel and fertilizer expenses associated with the Middle East crisis are adding to the cost burden.
Inventories provide a further indication that supply is exceeding the market's immediate capacity to absorb available oil. Italian stocks stood at about 233,000 tonnes in July 2026, compared with approximately 162,000 tonnes in July 2025. That represents an increase of more than 40% within a year. EU inventories at the end of the 2025/26 marketing year are estimated at around 420,000 tonnes, also above levels in previous seasons.
New campaign increases pressure on the market
Italy argues that the situation has become urgent as the 2026/27 olive oil campaign begins. Unless demand absorbs more of the accumulated stock, oil from the new harvest will enter a market already carrying substantial inventories. That combination could maintain pressure on farmgate prices and working capital, particularly for producers and processors with high operating costs.
The European Commission used the same reserve in the previous week to support Italian farmers affected by avian influenza and African swine fever. It mobilized €73 million for operators in the poultry, egg and pork sectors. Italy's olive oil request will now test whether EU institutions consider the combination of lower prices, larger stocks and elevated input costs serious enough to justify another exceptional intervention. Any support could ease short-term liquidity pressure, but the regional supply outlook will continue to depend on the size of the new campaign and the market's capacity to clear existing inventories.
