Price pressure pushes more powder into intervention

Published 17 February 16

The intervention campaign for SMP is filling up rapidly as EU wholesale prices remain under pressure. Nearly 30k tonnes have been offered so far, which is about a quarter of its volume limit.

The scheme is open until 30 September 2016 and allows 109k tonnes to be bought at the intervention price of €1,698/tonne. However, if it continues to fill at its current rate, it could reach the volume limit by May.

Once the limit is reached, product can only be offered through a tendering process, rather than at a set price. This could put more pressure on wholesale prices, as it removes the “price floor” effect that the set intervention level provides.

In addition to the intervention scheme, Private Storage Aid for SMP has also been extended until 30 September. Although this doesn’t aim to provide a price floor as such, it does help temporarily remove some product from the market during periods of low pricing.

Intervention 17Feb16