1. Weekly News

India

Government Action Aims to Lower Tomato Prices in Delhi

The government plans to sell tomatoes at a subsidized rate of USD 0.77/kg in Delhi and Mumbai through the National Cooperative Consumers’ Federation of India (NCCF). The price surge has been attributed to supply disruptions in Karnataka and Andhra Pradesh due to crop damage from retreating monsoon rains, pest infestations, and heightened festive season demand. Despite impacted weekly arrivals, the expected supply improvement from Maharashtra is anticipated to stabilize prices. Since October 7, the NCCF has sold around 10 metric tons (mt) of tomatoes at subsidized rates via mobile vans and outlets in both cities.

Peru

Peru's Tomato Export Overview for Sep-24

Peru exported 1,497 mt of tomatoes in Sep-24, marking a slight decline of 2% from the 1,531 mt shipped in Sep-23. The tomatoes were exported to 14 countries, with Colombia as the primary destination, making up 54% of the total exports, followed by Honduras at 14%.. There were 26 purchasing companies involved in the export process during this period.

South Korea

South Korean Tomato Market on Alert Due to Heat Wave

A heat wave has particularly affected the South Korean tomato supply, prompting companies to issue emergency alerts regarding potential shortages. In the first half of Oct-24, tomato imports to the local wholesale market plummeted by 43% compared to average years. The Ministry of Agriculture, Food and Rural Affairs (MAFRA) anticipates a sluggish overall growth in horticultural products due to this prolonged heat wave. However, production will recover as weather conditions improve in late Oct-24. The government aims to maintain an emergency response system and enhance growth management practices to address potential future supply disruptions due to rapid temperature changes.

Ukraine

Ukrainian Tomato Prices Increased Due to Supply Shortage

Ukrainian greenhouse plants have increased tomato prices due to a significant supply drop while demand remains stable. Producers attribute the reduced selection of greenhouse tomatoes to cooler weather and decreasing average daily temperatures. Consequently, greenhouse tomatoes sold for USD 1.33 to 1.58/kg in W42, reflecting a 10% week-on-week (WoW) price increase and marking the highest prices in at least seven years. Limited supply is further compounded by most small producers finishing their sales, leaving only low-quality tomatoes available in small wholesale quantities. As a result, indoor tomatoes are now priced higher by 22% year-on-year (YoY), with many producers indicating intentions to raise prices further due to sustained high demand.

Ukraine's Processing Tomato Forecast Lowered as Global Production Declines

Experts have revised their forecasts downward for the processing tomato crop in Ukraine, anticipating a total harvest of 550 thousand mt, a reduction from the initial estimate of 600 thousand mt. This adjustment is due to lower-than-expected yields this season. Globally, the World Processing Tomato Council (WPTC) has indicated that production will also decline, dropping to below 46 million metric tons (mmt) compared to last year's 44.4 mmt. Notably, around 312 thousand mt, or 52% of Ukraine's tomato harvest, has already been processed, with the average dry matter content of fresh vegetables reported at 5.3 brix, which is higher than usual.

2. Weekly Pricing

Weekly Tomato Pricing Important Exporters (USD/kg)

Yearly Change in Tomato Pricing Important Exporters (W42 2023 to W42 2024)

Mexico

In W42, Mexico's wholesale tomato prices surged to USD 2.36/kg, reflecting sharp increases of 95% WoW and 143.30% MoM, primarily due to the end of production cycles in crucial growing regions like Sonora and Sinaloa. However, tomato production in Mexico is projected to rise from 3.22 mmt in 2023 to 3.30 mmt in 2024, which is expected to help stabilize the market and contribute to a downward price trend. Although some producers are investing in protected cultivation to reduce the impact of weather fluctuations, a significant portion of Mexico's tomato production relies on open-field farming, which remains more susceptible to adverse weather and often results in lower yields.

Morocco

In W42, Moroccan tomato prices held steady WoW but saw an 8.33% decline month-on-month (MoM), settling at USD 0.33/kg. This drop is linked to the early arrival of the first harvest due to improved planting practices in the Souss Massa region, contrasting with the uncertainties faced in the previous season. However, despite this encouraging development, growers in Agadir are bracing for an overall decrease in tomato volume for 2024, as heatwaves negatively impacted key growing areas like Mohammedia, El Jadida, Oualidia, and Agadir.

Spain

In W42, Spain's wholesale tomato prices rose slightly by 1.12% WoW, reaching USD 0.90/kg from USD 0.89/kg. This is due to a brief dip in available supply during the transition period within the harvest cycle. Even though yields were generally high due to optimal weather, the current harvesting stage experienced brief supply lags as new batches mature and are ready for market. This temporary reduction in supply caused minor price upticks until the next wave of fully mature crops entered the market.

Türkiye

In W42, Türkiye's tomato prices soared by 20.59% WoW, 53.75% MoM, and 66.22% YoY, reaching USD 1.23/kg. This spike is mainly due to ongoing drought conditions and rising production costs, particularly for diesel and transportation, which have escalated disproportionately to stagnant product prices. This financial strain has led to producer dissatisfaction and protests in critical agricultural regions. Meanwhile, demand for Turkish vine tomatoes is increasing in Europe, as Türkiye benefits from more stable growing conditions than Spain and Morocco, which have faced extreme weather and water shortages. Retailers from these affected countries struggling to source supplies are turning to Turkish vine tomatoes, further driving demand.

France

In W42, tomato prices in France experienced a slight decrease of 8.86% WoW, settling at USD 2.16/kg, down from USD 2.37/kg, primarily due to increased production supply. However, a 3.35% MoM price increase was attributed to a notable shortage of round tomatoes, influenced by seasonal factors, especially in mid-Sep-24. Although imports from southern countries like Spain and Morocco faced delays, they are gradually entering the French market. Despite moderate demand, prices remain elevated as the production shortfall is more significant than the previous year.

3. Actionable Recommendations

Enhance Supply Chain Efficiency

India should focus on enhancing supply chain efficiency to mitigate future price spikes. Improving logistics and transportation networks is crucial. This can involve investing in infrastructure such as better roads and transport facilities to facilitate timely delivery of tomatoes from producing states like Maharashtra to urban markets. A robust cold storage infrastructure would help reduce post-harvest losses, maintaining supply levels even during high-demand periods such as festivals. Implementing real-time market information systems can empower farmers and traders to make informed decisions, allowing them to react quickly to market fluctuations. Moreover, promoting direct marketing channels, such as farmer-to-consumer sales, can reduce reliance on intermediaries and improve farmers’ profit margins.

Develop Climate Resilience Strategies

South Korea should prioritize the development of climate resilience strategies to combat the adverse effects of heat waves on tomato production, including investing in research and developing heat-tolerant tomato varieties that can withstand extreme temperatures while maintaining quality. Implementing advanced agricultural practices, such as controlled environment agriculture and shade nets, can help protect crops from harsh weather conditions. Furthermore, enhancing the emergency response system to address supply disruptions caused by extreme weather quickly will safeguard the tomato supply chain. Providing training programs for farmers on climate-smart agriculture techniques will equip them with the necessary tools to adapt to changing weather patterns, ensuring consistent production levels and potentially leading to better yields.

Diversify Export Markets

Peru should diversify its tomato export markets to reduce dependency on countries like Colombia and Honduras. This can be achieved by exploring trade agreements with emerging markets in Asia and Africa, where demand for fresh produce is increasing. . Peru should use marketing strategies to promote tomatoes as a premium crop to attract new buyers. Investing in quality certifications and improving packaging to extend shelf life will make Peruvian tomatoes more appealing internationally. Additionally, establishing partnerships with logistics companies can streamline export processes and maintain product freshness during transit. By broadening its export base, Peru can better stabilize its tomato market and reduce vulnerability to fluctuations in any single market.

Sources: Agrobusiness, Yonhap News Tv, Agrobusiness, Theprint, Agraria