guaranteed quantity became national for each productor Member State. So, olive oil aids for
countries were limited to: Spain 760,027 tons, Italy 543,164 tons, Greece 419,529 tons, Portugal
51,244 tons and France 3,297 tons every single year. The application of this stabilizer reduced
subsidies in the following way: a) If the real quantity produced is less than nacional guaranteed
quantity, the amount of subsidy was determined by the Council for the present crop year. The 80%
of the difference betweeen the nacional guaranteed quantity and the produced quantity will be
transferred to the following crop year to be taking into account in order to calculate the aplicable
subsidy; b) If the real quantity produced, taking into account the previous crop year, is above the
nacional guaranteed quantity, the amount of subsidy is modulated by a coefficient obtained by the
result of dividing national guaranteed quantity between the real quantity produced in that crop year.
After the intermedia CAP reform this system is no more implemented.
Intervention and storage
Intervention system and public olive oil storage disappeared with the 1998 reform and it
also disappeared the possibility of productors selling olive oil to community interventionist
organisms. However, market behaviour has made possible the existence of an elevated level of
autorregulation on behalf of cooperatives and oil mills.
On the other hand, with 1998 reform there was the possibility to help private storage
whenever the price of the olive oil was situated under 95% of the intervention price in
1997/1998 crop year (approximately 229.5 euros/100 kilogrammes. The Council could even
constitute, after a Commision proposal a level of olive oil regulatory existences whenever
irregularities in crops were detected2.
2003 Intermediate Reform
In 2003, European Commission introduced a new Common Agriculture Policy. This
reform means the avoidance of production subsidies and the introduction of a new subsidies
system of single payment (income support) and cuts the link between support and production
(decoupling). The majority of common market organisations will become subject to this new
system in 2005 or 2006 (with the exception of the new Member States). Direct aids may
continue until 2012, subject to certain conditions (cross-compliance), but they will be gradually
reduced. Certain crops are eligible for additional support to compensate for the loss of income
resulting from modulation and the transition to the single farm payment.
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2 This situation has been modified by CAP intermediate reform. See Council Regulation (EC) No 2153/2005 of 23
December 2005.