Coupled payments and support for olive growing in Italy in the 2014-20 CAP

This report examines the role of coupled payments in supporting olive cultivation, particularly in regions where the sector holds socioeconomic and environmental significance. The analysis applies to the entire Italian territory, with particular attention to Puglia, Calabria and Liguria, covering the years 2015 to 2020. It was conducted within the framework of the national 2014-2020 Rural Network Programme, 2021-2023 Action Plan, by ISMEA (institute of services for the agricultural and food market). During this period, a permanent crop plan to support olive growing was established for coupled premiums. This plan forms the basis of this analysis.

A quantitative approach was adopted, combining quantitative analysis using FADN (Farm Accountancy Data Network) data, Istat (Italian national institute of statistics) and administrative data from the Italian Paying Agency (AGEA), with insights from case studies and ISMEA surveys of representative olive holdings. The study employed indicators such as surface area covered, unit payments and gross margins per hectare. A summary indicator of the competitiveness of agri-food supply chains (developed by ISMEA) was also used to compare the competitiveness of the olive oil sector with other agri-food sectors. The analysis included regional comparisons and examined the incidence of support on farm income and value added.

The data show that the sector is experiencing difficulties in several respects. Over 2015-2020, olive area is broadly stable, but this cannot be attributed only to the coupled premium, given the influence of national rules limiting the removal of olive trees. Production shows an underlying decline with high year-to-year variability and is strongly influenced by external factors such as climatic conditions and plant-health problems. Competitiveness performance is reported as worsening relative to other agri-food sectors and in the international context, despite market opportunities linked to recognition of extra-virgin olive oil’s nutritional and health characteristics. Quality production improved in surface area, operators and recognised protected designation of origin (PDO) and protected geographical indication (PGI) oils, but PDO and PGI oil still represented only about 3.5% of national production and the report finds that support based on registered areas did not sufficiently ensure actual certified output reaching the market.

Overall, the economic role of the coupled payment is generally modest, with about 10% of gross margin and 8% of direct payments for recipient farms, with stronger relative importance in Calabria. The report recommended that any re-proposal of the premium in the 2023-27 programming period should identify ways of awarding support that can stimulate an increase in competitiveness. Supports should stimulate improvements in production quality and be coherent with CAP Strategic Plan needs and objectives.