Olympic average (reference yield)

The Olympic average is the mean of the last five years' yields after dropping the best and the worst. It serves as the reference production in subsidized EU crop insurance contracts: the loss is measured against it. The rule comes from the WTO Agreement on Agriculture, concluded in Marrakesh in 1994. Its Annex 2 places in the “green box” insurance support where the loss is computed on a three-year average or on this five-year Olympic average. CAP law took it over, and it appears in Article 76 of Regulation (EU) 2021/2115. In France, the law of March 2, 2022 lets the farmer use whichever of the two references is more favorable. The flaw is well known. After a run of bad years, the reference falls, and the policy only triggers from a yield that is already depressed. The French Senate report on the 2022 law called it the “first obstacle” to wider crop insurance uptake. The failed 2024 harvest revived the complaint among grain growers. For an actuary, it is a trimmed estimator, insensitive to extremes but blind to trend: if the climate erodes yields, the reference follows with a lag and coverage shrinks. Parliamentary proposals have called for stretching it to ten or fifteen years, or using the best of the five years. They run into the WTO framework. Not to be confused with the US actual production history (APH), which averages four to ten years without dropping the extremes.