1. Weekly News

Global

2023/24 Global Tomato Export Trends Show Morocco Gains and Spain Declines

The 2023/24 global tomato export campaign underscores significant shifts among leading exporters, with Morocco closing in on the Netherlands while Spain faces a concerning decline. The Netherlands retained its top position with 828,820 metric tons (mt) of exports, primarily to Germany with 310,360 mt and the United Kingdom (UK) with 164,020 mt. Morocco strengthened its position as a key exporter, delivering 701,860 mt, predominantly to France with 421,350 mt and the UK with 128,270 mt. The Netherlands imported 36,450 mt of Moroccan tomatoes, highlighting Morocco's growing influence in the European market.

Meanwhile, Spain's exports dropped to 632,610 mt, representing a steep 35.16% decline compared to 2014/15. Germany continued to be Spain's largest market, taking in 205,480 mt, followed by France with 78,950 mt and the Netherlands with 62,930 mt. This sharp decline reflects diminishing demand from key markets, including the UK, down 59.94%; France, down 46.2%; and the Netherlands, down 42.86% over the last decade, raising concerns about Spain's diminishing role in the global tomato trade.

Italy

Italian Tomato Industry Faces Competition and Climate Challenges

The Italian tomato supply chain, the third largest globally, faces significant challenges from unfair competition with non-European Union (EU) producers, climate change, and inadequate water infrastructure. These issues threaten its vital role in Italy's economy and employment. Industry leaders advocated stricter regulations to combat fraud, improved water resource management, and protectionist measures to ensure fair competition. They also urged the EU to adopt Italy's rule mandating that passata be made exclusively from fresh tomatoes with clear origin labeling. The sector prioritizes export growth as a key strategy to sustain operations amidst these pressures to offset declining domestic consumption.

Morocco

Morocco's Cherry Tomato Dominance Sparks Trade Dispute with France

Morocco's growing dominance in the French cherry tomato market has become a contentious issue, especially following the EU extension to Morocco's free trade agreement to include products from the disputed Western Sahara. Morocco accounts for 52% of France's annual cherry tomato turnover, with exports rising to 425 thousand mt in the 2022/23 season, a year-on-year (YoY) increase of 7.6% in volume and a 27.5% surge in value compared to the previous year. French farmers demand stricter regulations, tariffs, and seasonal protections to address the competitive imbalance. The European Court of Justice supported a challenge by the Polisario Front to require accurate labeling of Western Saharan products instead of Moroccan labels. However, the European Commission (EC) has yet to enforce specific control measures. This regulatory and trade conflict underscores tensions between French agricultural interests and Morocco's advantageous export position under the EU-Morocco free trade agreement.

Ukraine

Ukraine's Greenhouse Tomato Prices Hit 7-Year High Amid Supply Shortages

In W49, Ukraine greenhouse tomato prices surged by 13% week-on-week (WoW), reaching USD 1.92 to 2.16 per kilogram (kg), marking the highest levels in at least seven years. A seasonal decline in local supply drove this increase, as many greenhouse producers have completed their production cycles. Limited vegetable samples at stationary processing plants further allowed sellers to raise prices while traders still needed to offset the supply gap with imports. Compared to late Nov-23, prices are now 49% higher. Analysts forecast that imports, mainly from Türkiye, will rise soon as the Ukrainian sales season concludes, making imported products the primary source of greenhouse tomatoes in the coming weeks.

2. Weekly Pricing

Weekly Tomato Pricing Important Exporters (USD/kg)

Yearly Change in Tomato Pricing Important Exporters (W49 2023 to W49 2024)

Mexico

Mexico's tomato prices decreased slightly by 2.42% WoW to USD 2.82/kg in W49 but remained significantly higher month-on-month (MoM), up 46.11% from USD 1.93/kg. This sharp monthly increase reflects strong demand and potential supply chain disruptions, while the recent weekly decline may indicate stabilizing markets or improved short-term supply. However, a recent study conducted by Universidad Iberoamericana and the National Autonomous University of Mexico (UNAM) has raised significant health concerns that could influence market dynamics. The study revealed that tomatoes, along with other agricultural products like mushrooms and lettuce, contain high concentrations of cadmium (Cd), a toxic and carcinogenic heavy metal. This contamination, affecting 68.5% of tested foods, is primarily linked to anthropogenic soil pollution, such as industrial waste. These findings could dampen consumer demand domestically and internationally due to health concerns, potentially exerting downward pressure on prices. Moreover, stricter safety regulations in export markets may limit Mexico's access to key buyers, impacting trade volumes. Addressing soil contamination will be essential to mitigate long-term risks, but it could also lead to higher production costs, influencing future price trends. Balancing immediate price fluctuations with health and environmental concerns will be crucial for sustaining the competitiveness of Mexico's tomato market.

Morocco

In W49, Morocco's tomato prices fell sharply by 11.11% WoW and 40% MoM, reaching USD 0.24/kg. This significant decline resulted from Morocco's tomato production peaking in the fall and early winter, creating a seasonal oversupply that exceeded demand and pressured prices downward. Enhanced harvest yields in key producing regions, such as Souss-Massa, contributed to the increased market volume, intensifying the price drop. Seasonal factors such as increased domestic availability and decreased consumer demand, typical during cooler months when tomato consumption tends to decrease, contributed to this trend. Furthermore, reduced export activity and logistical improvements, including lower transportation costs, played a role in lowering overall market prices.

Spain

Spain's tomato prices declined by 3.13% WoW to USD 0.62/kg in W49, down from USD 0.64/kg. This marks a significant 34.04% MoM and a 45.61% YoY decrease. The decline is due to a strong start to the tomato season in Murcia, where favorable weather conditions, including moderate rainfall and lower temperatures compared to previous years, have resulted in higher supply and high fruit quality. Production currently operates at 80 to 85% capacity, ensuring stable yields. Moreover, adopting disease-resistant tomato varieties has enhanced production, further supporting the season's positive outlook. However, competition from Morocco, particularly during the early part of the season, poses challenges by applying pressure on prices and potentially impacting Spain's ability to sustain higher prices. Despite this, Spain's favorable crop conditions and strategic agricultural practices suggest a resilient pricing environment, provided there are no significant supply disruptions or adverse weather.

Türkiye

Türkiye's tomato prices dropped to USD 1.33/kg, marking a 13.07% WoW decrease. The ongoing tomato harvest in the Ahlat district is progressing at full speed, with tomatoes from the region continuing to find their place on market shelves. Increased market availability, driven by the intensive efforts of local producers, has significantly boosted supply, leading to lower prices. Despite the price decrease, demand for grown tomatoes has risen rapidly. However, a YoY comparison reveals a substantial 64.20% price increase from USD 0.81/kg in W49 of 2023. This sharp rise is due to escalating operational costs, particularly for diesel and transportation, which have outpaced the growth in tomato prices. These rising costs have placed financial strain on producers, prompting protests from farmers in key agricultural regions.

France

In W49, France's tomato prices decreased to USD 1.42/kg, reflecting a 5.96% WoW drop and a 29.70% MoM decrease. This price decline is due to the nearing end of the French tomato season, as producers conclude their harvests. While prices for grape and fleshy tomatoes remain stable at around USD 1.90/kg and round tomatoes at USD 1.58/kg, overall market conditions have prevented significant price increases. Sufficient domestic supply and quality inconsistencies towards the end of the season have contributed to price variations across batches. French prices are relatively low compared to neighboring markets, where Dutch and Belgian tomatoes stood at USD 2.32/kg.

3. Actionable Recommendations

Focus on Cost Control and Improve Profitability for Farmers

Türkiye should explore cost-control measures in its tomato production chain, including reducing transportation and operational costs, while exploring government subsidies or funding opportunities for infrastructure improvements. While demand for Turkish tomatoes is rising, price increases in operational costs, particularly diesel and transportation, have strained profitability for farmers. To maintain competitiveness, Türkiye should improve its logistics infrastructure and explore alternative energy sources for farming operations to reduce costs. Furthermore, establishing subsidy programs for local farmers could help alleviate financial burdens, ensuring that Türkiye remains competitive in the global tomato market.

Enhance Domestic Support and Export Competitiveness

Spain should implement stricter regulations to ensure fair competition and provide more support to local tomato producers, including incentivizing investments in modern farming techniques and reducing reliance on external inputs like water. With declining exports and heightened competition from Morocco, Spain’s tomato industry needs to focus on improving its domestic productivity and sustainability. This could include government-backed support for technology adoption, such as water-efficient irrigation systems and disease-resistant tomato varieties. Moreover, Spain could implement quality certification programs and promote its tomatoes through targeted marketing campaigns, especially in niche markets, to boost its export competitiveness.

Diversify Export Markets and Focus on Value-Added Products

Morocco should continue to expand its tomato export base, focusing on diversifying markets beyond France and the UK while emphasizing value-added products such as canned and dried tomatoes to increase revenue per unit. Countries like Türkiye and Mexico can also benefit from similar strategies. With its growing influence in the European market, Morocco can mitigate risks from market concentration by exploring new export destinations, such as emerging markets in Asia and the Middle East, where demand for fresh and processed tomatoes is increasing. For example, Morocco could increase exports to India, Saudi Arabia, and the United Arab Emirates (UAE). Likewise, Türkiye and Mexico, both major tomato exporters, should also focus on diversifying their markets, especially in Africa and Southeast Asia, while moving towards higher-value products. Diversifying into value-added products like canned or dried tomatoes can help capture higher margins and reduce reliance on seasonal fresh tomato exports. This approach will help Morocco, Türkiye, and Mexico solidify their positions as key global players in the tomato export sector.

Sources: Tridge, Agro Portal, Agro Naplo, Agri Maroc, Llsole24or, Record