Morocco implements import tax exemptions for wheat amidst production crisis

29 January 20212 min reading

Morocco is projected to increase wheat imports by 1.9 million tons to a record 6.5 million duringthe current 2020/21 marketing year, making it a key player in global wheat trade.

Rising imports in Morocco are a direct result of low domestic production following two consecutive years of drought. While Morocco wheat production is normally volatile, the 2020/21 crop was particularly affected by dry weather and fell to nearly half of the 5-year average. In response, the Moroccan government issued an exemption on import tariffs for common (non-durum) wheat beginning January 2, 2020. The exemption was also expanded to include durum wheat beginning April 1, 2020.

The Moroccan government typically reduces and increases its import duties according to the local harvest schedule and the local supply and demand situation. However, a zero-rate import tariff, particularly for a sustained period, is unprecedented, and reflects the severity of Morocco’s supply situation. The exemption allows for an influx of international wheat to fulfill the country’s consumption needs, thus removing typical protections for domestic producers while lowering prices for consumers. Recently, the tariff exemption was once again extended through May 31, 2021.

Morocco wheat imports are typically sourced from Europe and the Black Sea. France has dominated the market over the past few years; however, its reduced 2020/21 crop, increased shipments to China, and price disadvantage compared to Black Sea wheat suppliers have limited exports from France to Morocco to date for 2020/21. Instead, Ukraine has dominated the non-durum market given its competitive pricing, nearly doubling its exports over the same period last year. Canada continues to be Morocco’s primary supplier of durum wheat. USDA

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