Morocco. A Severe Drought has a Negative Influence On the Grain Crop Sept. 28, 2016

Highlights

Morocco is currently experiencing a severe drought, which has caused grain production to fall 70 percent from the previous year. The Ministry of Agriculture announced final cereal production for MY2016/17 at 3.35 million MT. On September 20-21, Morocco filled tenders for 235,000 MT of U.S. wheat under the TRQ. Morocco is soliciting bids for a further 303,637 MT of U.S. wheat.

General Information

The Moroccan Ministry of Agriculture announced final cereal production for MY2016/17 at 3.35 million MT, a 70 percent decline from the previous year. This production was comprised of 1.86 million MT of soft wheat, 0.87 million MT of durum wheat, and 0.62 million MT of barley. The decline in production was due to poor rains that delayed planting activities, reduced the area sown and significantly lowered yields throughout most of the grain producing regions.

Morocco is currently experiencing a severe drought, which began in October 2015. In an effort to head off rising wheat prices and avoid possible shortages, the Government of Morocco (GOM) lowered import tariff on common wheat from 75 percent to 30 percent in late 2015. This move served to keep domestic prices at around 2,588 MAD ($263) per metric ton. In order to secure adequate wheat supply, while at the same time keeping imports in check, Morocco has increased import tariff to 65 percent, as of June 15, 2016. This move aims to safeguard local industry and keep consumer prices unchanged.

In an effort to encourage local wheat production and increase local supply, the GOM has also been working to increase the quantity of land under irrigation as well as expanding access to crop insurance among farmers, and preserving seeds that will be provided to farmers for the next growing season.

Wheat tenders launched

On September 20 and 21, 2016 the Cereals Office (ONCIL), under the Ministry of Agriculture, solicited bids from importers for licenses to import wheat under the U.S. and E.U. tariff rate quotas.

On September 28, 2016, ONCIL again issued a tender for U.S. wheat under the TRQ. Buyers are expected to provide offers for up to 303,637 MT of U.S. soft white wheat when bids open on October 5, 2016.