Morocco to prolong wheat import campaign in January-April

Morocco will offer subsidies to import up to 2.5-million metric tons of soft wheat between January 1 and April 30 2024, state grains agency ONICL said, as the North African country pursues an import programme to offset drought-affected local production.

The January to April import scheme was approved by Morocco's finance and agriculture ministries, with subsidy details to be published separately, ONICL said in a note on its website.

After drought reduced its domestic wheat crop for a second year, Morocco launched an import programme for the 2023/24 season covering up to 2.5-million tons for July to September, followed by a second round for October to December allowing up to 2-million tons.

Traders had expected the import campaign to continue after shipments so far this season lagged volumes available under the subsidy schemes, and with low rainfall again creating uncertainty about Morocco's next harvest.

The longer import window could be welcome for the EU, for which Morocco has become the main export outlet.

Traders have already cited renewed interest from Moroccan buyers for EU supplies in recent days following a drop in prices and with Russian competition appearing to ease.

“The winter season will make Russian shipments difficult, so an extension of the Moroccan subsidy programme could be positive news for EU sales,” one European trader said.

Further demand from Morocco could be particularly important for France after traders reported that some shipments of French wheat for China had been postponed.

In addition to losing significant market share to Russian wheat in Algeria, the EU also faces emerging competition from Russia in Morocco after the north African country adjusted its import system to help Black Sea origins.

About 140,000 tons of Russian wheat have been shipped to Morocco so far this season, LSEG data showed.

That compares with 1.8-million tons of EU soft wheat shipped to Morocco since July 1, according to EU data.