The Italian olive oil industry warns of 'serious damage' to the sector if the US applies tariffs on olive oil

The Italian olive oil industry warns of "serious damage" to the sector if the US applies tariffs on olive oil

2019/12/07 - The Italian Association of the Olive Oil Industry (Assitol) has warned that if the United States applies tariffs on olive oil, exports to the United States would be reduced by half and sales would fall by more than 50% for companies in the sector and related industries.

In a statement, the association has considered "a very worrying sign" the definition of a second list of products that might be taxed, decided by the US Administration as retaliation against the EU in its dispute over subsidies to Airbus.

"If the United States Trade Representative (USTR) office acted in accordance with these first indications, imposing ad hoc taxes, the entire chain of supply would suffer serious damage, in fact, with a tax on 100% of the product, the price of extra virgin olive oil would increase twice, which would be unsustainable for the US consumer and, therefore, induces buyers to look for olive oil elsewhere or identify alternative oils," explains Anna Cane, president of the Olive Oil Group of Assitol.

In this sense, Cane has pointed out that a lower European export, which guarantees to the United States 80% of the bottled oil, "will give space to the products of our competitors, particularly from North Africa, such as Tunisia and Morocco. Even assuming that rights are subsequently canceled, it will be very difficult to recover the lost market."

In their opinion, the consequences of high prices and lack of supply in Italy will cause "a drastic cut of our exports by more than 50% and, at the same time, the reduction of business volume of companies."

Cane stressed that the Italian industry, which in recent decades has made known extra virgin olive oil around the world, markets around 60% of its products outside its borders, so that packaging would also be affected, as well as the logistics. "With the sudden fall of exports, all this would be in serious difficulties," they added.

According to his data, in 2018, the export of olive oil to the United States amounted to 94,000 tons and only extra virgin olive oil, which represents 66% of this flow, has meant for Italy a value of almost 400 million dollars .

Therefore, Assitol has asked the institutions to intervene. "We have already written, through Fedolive, our European confederation of the sector, to the competent authorities, but a serious position of Italy is necessary to avoid the possible effects of this measure and prevent its entry into force."

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