New Quotas on Moroccan Tomato Exports to Worsen European Shortage
On February 19th, The Moroccan government imposed new daily quotas on tomato exports in an effort to boost local supplies and lower prices. The trade regulations come after a reported tomato shortage in all European markets, which has threatened local supply and prices in Morocco ahead of the fasting month of Ramadan. According to the Moroccan Association of Producers and Exporters of Fruits and Vegetables (APEFEL), the quota introduction comes after a consultation between the Moroccan government and producers, as producers are aware of the necessity to support Moroccan customers as well as maintain a significant flow to European markets.
Rising input prices, pest attacks, and repeated droughts have combined to hamper tomato production in Morocco, the world’s fourth-largest tomato exporter. Furthermore, in the first weeks of 2023, unusual temperature fluctuations in key producing regions have dropped tomato production considerably. Therefore, exports to the EU have also decreased, supporting an unprecedented tomato shortage in the UK and main European markets.
Besides the decrease in domestic production, there is also an intensified demand for Moroccan tomatoes in Europe, as the main producers in the region have all suffered a decline in production. Tomato production in the EU has overall been hampered by high fuel and energy costs, packing materials, and fertilizers costs. In Spain, according to Carlos Iborra, Tridge’s Origination Manager in Spain, due to the high temperatures that affected the production area in the summer of 2022, a 50% loss in cherry tomato production in Spain is expected at the end of the 2022/23 campaign.
As a result of the sudden decrease in domestic production and the increase in demand in the international market, the price of Moroccan tomatoes has risen drastically in the first weeks of 2023. According to Moroccan Food Export Control and Coordination (FOODEX), between weeks 4 and 6, tomato prices in Morroco were between USD 1.25/kg (MAD 13) and USD 1.54/kg (MAD 16). The increase represents an increase of around 40% from the previous month. As tomatoes are a very important product for the domestic market, the agricultural industry and the regulatory authorities have expressed serious concerns over higher prices just one month ahead from Ramahdan.
In order to avoid a price collapse in the local market, the Moroccan government has decided to cut tomato exports to all foreign destinations by applying a daily export quota. The export restriction has been added to the previous export ban of tomatoes and other vegetables from Morocco to West African countries imposed earlier in 2023. Both export restrictions clearly indicate the African country is adding necessary measures to protect this local tomato market and curb prices as much as possible. The new exportation quota will reduce exports of only round and grape tomato varieties to only 10% of daily volumes.
However, the restrictions on Morocco’s packing factories to a daily quota could exacerbate the produce shortfalls that have already caused product rationing at some European supermarkets.
Over the past ten years, tomato exports to the EU market have been dominated by the Netherlands in the first place but followed closely by Spain. However, since 2022, Morocco has supplanted Spain in the tomato market in the European Union and has become the second-largest supplier of tomatoes for the EU market.
Other key tomato-importing markets in Europe, such as the UK, France, and the Netherlands, will be directly affected by the export quotas at a crucial time when their supply is extremely limited. As a result, the European market will need to look for more diverse tomato suppliers that could fulfill their demand, particularly in the winter season when it has become harder and more expensive to produce.