Soft wheat: tension rises

Soft wheat: tension rises
Soft wheat: tension rises

Highly dependent on soft wheat imports, Morocco remains subject to the vagaries experienced by supplier countries. , which is experiencing metrological disruptions damaging the cereal campaign, is no better off. A situation which exacerbates the fears of importers. Lighting.

The situation in cereal production is worrying. The latest disturbances in France and Russia have caused panic among traders. A concern that extends to Moroccan grain traders.

The die is not yet cast
Indeed, the intermittent rains that France has experienced recently have disrupted wheat crops. According to certain specialists, the first estimates indicate that the cereal campaign promises to be less good than the previous one. Another worrying observation is the decline in areas sown with wheat. Statistics show that this area decreased by 7.7% compared to the last season.

Worse still, crops are affected by humidity. As Morocco remains heavily dependent on grain imports, mainly wheat, the question arises as to the availability of supplies, with France remaining the Kingdom’s main supplier.

“Everything suggests that the harvest will be smaller, although it is too early to draw hasty conclusions, particularly in terms of the quality of production. However, for now, it’s the weather market. In other words, we monitor the state of the crops very closely, but we still try to anticipate quality. We will have to wait until June to be determined. Currently, the market remains nervous,” relates Omar Yacoubi, president of the Federation of Cereal and Legume Traders (FNCL). Certainly, the die has not yet been cast, but international prices are starting to rise.

On Euronext, the price of a tonne of soft wheat is now trading at more than 259.75 euros/t instead of €200 in March. For Moroccan importers, the increase is estimated at 50 dirhams per quintal, according to the president of the FNCL, who displays a hint of optimism. He says the delay can always be made up.

Skepticism
However, other facts are plaguing the global market. These are the meteorological hazards which affected Russia, the world’s leading exporter, to which Morocco also appeals. Since the country opted to diversify its sources of supply, while imports generally came from , Russia is now part of the list of suppliers. However, agricultural production in this country seems compromised, which amplifies concerns. “The campaign in Russia is not showing much promise, which means that traders will have to turn to other suppliers, notably France.

Thus, tension will be exerted on the market. Not only will prices skyrocket, but the risk of unavailability of the goods cannot be ruled out,” Yacoubi fears. Furthermore, imports continue to reach 11 million tonnes (Mt), all cereals combined, as of April 30, including 4.35 Mt of soft wheat.

To support imports, the ONICL (National Interprofessional for Cereals and Legumes) grants a fixed bonus to operators. The flat-rate premium to be returned by the State corresponds to the difference between the average cost price leaving the port for the month and the price of 270 dirhams per quintal.

Moreover, this regime has been extended until December 31. According to our information, the amount of restitutions which amounted to several billion dirhams has decreased. For good reason, part of these restitutions was paid just a few days ago, even though the operators had waited a long time before receiving their dues. Operators also complain about port logistics which would harm them. In fact, as the situation deteriorated locally following the severe drought, the country found itself forced to fill the gap by increasing imports.

“We have reached record quantities in terms of imports. More than 80% of this volume arrives at the ports of Casablanca and Jorf Lasfar. We are therefore encountering difficulties, as these ports are not equipped to receive such quantities. That said, the National Ports Agency is trying to make the process easier for us,” says the FNCL.

In short, operators are demanding a smoother flow of port traffic.

Omar Yacoubi
President of the FNCL

“The campaign in Russia is not showing much promise, which means that traders will have to turn to other suppliers, notably France. Thus, tension will be exerted on the market. Not only will prices soar, but the risk of unavailability of the goods cannot be ruled out.

Maryem Ouazzani / ECO Inspirations

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