EU moves to prop up tumbling olive oil prices

The European Union's executive said on Thursday it intends to offer financial aid in the coming weeks to EU olive oil producers hit by falling prices.
The European Commission said it would approve EU funds to help cover the cost of privately storing virgin olive oil for six months, by which time the 2011/12 harvest would be complete.
"By providing a six-month storage period, I believe that we will not adversely affect the market at the start of the new season," EU agriculture commissioner Dacian Ciolos said in a statement.
The hope is that the storage period will allow sufficient time for prices to recover before the oil is released back onto the EU market.
Spanish farmers demanded such a move by EU authorities earlier this year, saying olive oil prices had fallen below their production costs.
The Commission said it had acted after prices in Spain — the bloc's top olive oil producer — fell in recent weeks below the triggering level for EU private storage of 1.77 euros per kg.
The storage aid will be allocated on the basis of tenders, and will cover up to 100,000 tonnes of virgin olive oil.
Tenders can be lodged in all EU olive-oil producing countries, which also include Italy, Greece, Portugal and France.
Olive oil has been an essential part of the Mediterranean diet for thousands of years, and olive trees cover many hillsides in the south of these countries that are often unsuitable for growing other crops.