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Morocco Grain, Feed Update: Positive Despite Late Start to Season

16 January 2012

USDA Foreign Agricultural Service

The 2011/12 grain planting season in Morocco had a late start, with the first significant rainfalls arriving towards the end of October, but despite the delay in planting, agricultural experts remain hopeful for a good grain harvest, according to the USDA Foreign Agricultural Service.

Production

Cumulative rainfalls during September- mid October period were 74 per cent lower than their normal levels, and down 89 per cent compared to the same time period last year. Heavy rainfall resumed in most of the grain production areas, in the Gharb, Doukkala and Saiss regions, through the first week of November. Despite the late start, Moroccan agricultural officials remain optimistic that the grain crop this season would be good, since many of the wheat farmers still have the opportunity to finish sowing their fields until the end of November. The Moroccan government has been encouraging farmers to use certified seeds by providing price support for seed planting. The government subsidizes about 40-60 percent of the costs of using certified seeds, with the subsidy amount increased this year by about 6 percent compared to last year. Currently, the area planted with certified seeds covers about 20 percent of the total grain crop.

Official estimates for Morocco’s grain crop production in the 2010/2011 season were revised slightly down, with soft wheat production at 4.17 million MT, durum wheat at 1.85 million MT and barley production at 2.34 million MT. The table below shows the breakdown of Morocco’s grain production in the last three years.

PS&D tables have been revised to reflect Post’s assessment of the production and utilization number as well as trade projection for wheat and barley.

Consumption:

Common (soft) wheat is a politically and socially sensitive commodity in Morocco. The government devised a mechanism by which bread wheat prices have been successfully maintained at low levels and the government treasury has supported the difference in the costs. In recent months, the Moroccan Bakery Association has threatened to increase the price of subsidized bread from 1.20 MD to 1.40 MD per loaf, citing rising production cost and energy prices. Through an agreement reached with the government to obtain electricity at preferential rates and receive wheat flour at the subsidized rate of 3500 MD/MT, the bakeries agreed to hold bread prices unchanged and the Moroccan government avoided a potential PR crisis of having bread prices rise before an upcoming parliamentary election campaign.

A significant part of the 2010/2011 wheat crop has been damaged (germinating kernels) due to heavy rains and excessive moisture during harvest time. Though the government has not issued an estimate of the wheat quality damage, it has increased germination threshold percentage in the wheat it buys from farmers. Much of the sub-quality wheat that will not be suitable for flour milling, reportedly 10-15 per cent, has to be utilized in animal feed.

Post’s estimate for Morocco’s wheat import in MY 2011/2012 was revised upward, to 3.1 million MT, to reflect projected increase in soft wheat imports due to the quality issue.

It should be noted that tenders to import wheat under the TRQs of Morocco’s respective FTAs with the US and the EU that were issued by the Moroccan National Office of Cereals (ONICL) in 2011 have not been successful. Importers refrained from participating at the tender due to their expectation that the government will be suspending wheat imports duties. In fact, the suspension of import duties was announced and will be effective November 15.

Further Reading

- You can view the full report by clicking here.

January 2012

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