The Spanish Olive Oil with Quality Differentiated by a Protected Designation of Origin

Abstract

The Protected Designation of Origin (PDO), part of the EU’s quality policy for agri-food products, aims to provide consumers with reliable information on the quality of a food, linked to its origin. Olive oil has perceptible qualities derived from its place of production, which create a link between the product and its place of origin, and which can influence consumer preferences. Spain, the world’s leading producer of this vegetable fat, had 29 PDOs at the end of 2020, 25.84% of the EU total for this industry. Based on the arguments drawn from the literature and the information provided by the Spanish Ministry of Agriculture, Fisheries and Food (MAPA), this paper first analyses the importance of olive oil with differentiated quality certified by a PDO for the Spanish olive oil industry. Secondly, the t-test is applied to identify positive differences in the income earned by farmers who produce olive oil certified by a PDO. Thirdly, the international competitiveness of extra virgin olive oil (EVOO) bearing a PDO label is analysed using the Revealed Comparative Advantage (RCA) index. The evidence confirms that PDO certification adds value to the product and promotes exports. However, the Spanish olive oil industry does not perform well enough to harness the potential offered by this quality label, it as it does not manage to sell all the PDO-certified EVOO. This situation merits further investigation in future studies, and should be taken into account in the design of actions and campaigns organised by institutions involved in the industry. This article contributes to the evaluation of the quality policy for EU agri-food products and examines the recent evolution of the Spanish PDO-certified olive oil industry.