The US Ships Less Corn, but Many Corn Co-products to Morocco
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Agriculture contributes almost 13% to Morocco’s Gross Domestic Production. In 2022, Morocco’s Corn production fell by 4.1% to 115,000 tons compared with the prior year, according to the USDA. As of the 2019/2020 crop year, the production of Corn in Morocco amounted to around 300 thousand quintals. The region of Casablanca- Settat accounted for almost 185 thousand quintals, the most significant production registered in the country, followed by Marrakech – Safi (44 thousand quintals), Tanger – Tetouan – Al Hoceima (28 thousand quintals), and Beni Mellal – Khenifra (24 thousand quintals). On the other hand, Corn production was lowest in the Oriental region as of the same year.
Morocco’s Corn imports forecast for the current marketing year beginning October has been lowered by 8%, the U.S Agriculture Department said in March. Import estimates have been revised down to 2.3 million metric tons, down from 2.5 million in a February 8 report, due to lower exports from Argentina, according to the USDA’s latest “Grain: World Markets and Trade” report. Corn imports in 2021-22 were predicted to fall to 2.3 million tons, down from 2.9 million.
Argentinean and Brazilian Corn imports were controlling 90% market share. US Corn was in third place with a 7% market share. However, the US was increasing its Corn exports. Also, the US is the leading supplier of Corn co-products to Morocco with 83% market share, followed by Argentina with 13% and the Netherlands third with 6%. The poultry and dairy sectors are the primary consumers of imported Corn.
The US- Morocco FTA provides the advantage of no tariff on Corn and other feed products, compared to a 2.5% tariff applied to different export origins. This advantage is often below the price spread between the US and South American origins in 2020.
According to AgFlow data, Morocco imported 0.7 million tons of Corn in Jan – Apr 2023. Argentina led its import market with 0.2 million tons, followed by the United States (0.18 million tons), Brazil (0.17 million tons), and Romania (91,574 tons). Most Argentinian Corn was shipped from San Lorenzo port, while the United States exported most of the commodity from the Mississippi River port.
Argentina’s Draught Impact on Moroccan Corn Import
Morocco’s annual Corn imports from Argentina are set to drop in 2023 as yield reaches a three-year low. According to data from the United States Department of Agriculture, Morocco’s Corn imports from Argentina are set to reach 2.3 billion tons in 2023, down from 2.5 billion tons a year earlier.
Argentina’s Corn exports are set to drop by 4 billion tons, going from 33 billion tons in 2022 to 29 billion tons in 2023. The country is facing the worst drought this year in over 60 years.
The South American country is the world’s top exporter of processed soy and ranked third for Corn. However, the country continued to cut soybean and Corn harvest forecasts this year. “We are facing an unprecedented climatic event,” the Head of economic research at the Argentina Rosario exchange, Julio Calzada, said.
Calzada added that farmers could be facing a cumulative loss of $14 billion and a reduced production that could reach 50 million tons worth of soy, Corn, and wheat. “It’s unprecedented that the three crops fail. We are all waiting for it to rain,” he added. The drought comes when the country is already facing economic turmoil, with inflation reaching a staggering 99% and the country’s external debt mounts.
“The situation is dramatic,” the head of the commercial ports chamber and soybean industry body, Luis Zubizarreta, said in the Reuters report. “It impacts the country’s entire economic situation and the income of foreign currency at a critical moment for Argentina,” he lamented.
Other sources: MOROCCO WORLD NEWS
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