Rabat The prices of oils in Morocco have witnessed successive increases over the past two years, described by consumer protection associations as “massive” (the price of a 5-liter bottle of vegetable oil increased by about 27 dirhams ($3)).
According to a report by the Competition Council, the import of raw vegetable oils costs Morocco an “exorbitant bill” of 4 billion to 9 billion dirhams annually (one dirham equals $0.11).
While the Kingdom’s lands contain potential for oilseed production, which may reach 600,000 hectares, an area that can be mobilized in the cultivation of sunflowers and colza.
What is the reality of agriculture and the oil industry? Will Morocco reduce its dependence on the international market in a vital material by raising the production of oilseeds locally?
From the Chaouia region in the Casablanca region, the producer Azzedine Brahali (in his sixties) told us about the reality of oil crops.
Barahli, who is currently an agricultural consultant and general writer for the Oil Plant Producers Association in the Casablanca-Settat region, said in an interview with Al Jazeera Net, that Morocco produces very little of the oilseeds. Note that the chain is important and strategic, as it enables the production of oils and “torto”, which is a source of protein for animal feed.
According to the conclusions of the Competition Council report, the agricultural production of oilseeds is almost non-existent, as the country’s needs of oil raw materials are almost completely imported, with a rate of 98.7% from the international market, mainly in the form of raw vegetable oils, and locally produced oilseeds contribute only 1.3%.
Barahli – who previously worked in the framework of multiple programs for oil crops that the Kingdom has known since the eighties of the last century, told how agriculture witnessed development and contribution to covering its needs of oilseeds at an earlier time.
The area of sunflower cultivation between the mid-1980s and the beginning of the 1990s reached 200,000 hectares, and the production of these grains amounted to more than 160,000 tons, thanks to the state’s intervention at the level of securing the selling price of oilseeds and ensuring the marketing of production for farmers.
Starting in 1994, the area of oilseeds declined, due to drought, in addition to the policy of liberalizing the oilseeds production sector and the production of table oils.
In 2013, the Ministry of Agriculture signed a program with the Interprofessional Federation of Oilseeds (a professional grouping of producers and processors) extending from 2013 to 2020, for which investments amounting to 421 million dirhams were mobilized, of which 117 million were provided by the state, and the achievements remained much less than the goals that were set. According to two observers.
According to the data of the Ministry of Agriculture, oil crops, especially sunflower and rapeseed, are concentrated in particular in the Rabat-Salé-Kenitra region and the Fez-Meknes region. Rape cultivation is being developed in the regions of Casablanca-Settat and Beni Mellal-Khenifra.
A new and ambitious program
The Competition Council and the various actors in the oil sector recommend the development of national crops of rapeseed and sunflower, considering that it enables to reduce dependency on imports, improve trade balance, strengthen economic activity, and reduce the impact of prices on household budgets.
The Council suggested extending the procedures related to the previous state program contract (2013/2020).
The “Green Generation” strategy seeks to plant 80,000 hectares of oil plants, including 30,000 colza and 50,000 sunflowers, by 2030, with the aim of meeting 15% of the local market’s needs.
The “Morocco Oligeno” program funded by the European Union contributes to the development of the oilseed sector, in cooperation with the National Agricultural Consultation Office and the Professional Federation of Oil Plants, through the training of operators in this sector.
the specter of drought
Abdullah Dehdi, an expert in the agricultural field, said, in an interview with Al-Jazeera Net, that the expansion of oil crops is an ambitious program, noting that the problem is not in the programs (where the programs interested in the sector continued), but the goals were not achieved, and he explained that climate change is a real obstacle unless Farmers’ habits are changing by adopting techniques adapted to drought, which has become a structural problem.
The agricultural expert considered that the opportunities in the areas are available, but the challenge of climate change makes the opportunities confined to the West, the Sais and the North, and this achieves fewer goals, and Dahdi said that in the case of supporting the farmer to change techniques, we can achieve important local production.
This was expressed by the farmer and producer Ezz El-Din Berhali by saying that the farmers are ready to develop the areas, and they have accumulated experience for this, but taking into account the production challenges, while supporting production inputs (seeds, pesticides, fertilizers…) and not marginalizing the farmer and enabling him with technical support. necessary.
Central market and only liquidation
Morocco contains two conversion units and 5 refineries, and the market for table oils is completely liberated, and the oil industry is dominated by the filtering of raw vegetable oils imported from abroad over the extraction of raw vegetable oils, from oilseeds, thus not exploiting the available production capacity.
The European Union is the largest supplier of crude vegetable oils to Morocco with 54%, followed by Argentina with approximately 34% and the United States with 7%.
90% of the domestic production of refined oils is directed towards local consumption, 10% is directed towards exports, and household consumption represents 73% of the national production, while the consumption of companies operating in the food industries sector represents 17%.
The individual consumption of table oils is 15 kg per year.
The value of table oils market transactions amount to about 6 billion, and the market is monopolized by 4 companies (Lesieur Crystal, a branch of the French group Avril, Ma’al Oils Bsous Belhassan, Siouf Company, Savola Morocco, a branch of Saudi Savola Company).
According to the Moroccan Competition Council, the structure of the table oils market knows a high level of concentration, as the leading company Lesieur Crystal alone holds 45-50% of the total market share. Total market transaction number.
The cumulative share of the first three companies (Losieur Crystal, Bsous Belhoussine Oil Factories, Savola) is 95%, which makes the innovation and competition dynamics in the table oils market at the national level weak, given the stability of the level of supply and demand in the table oils market in the Kingdom.
Price hike controversy
The Moroccan Competition Council concluded that the increases in the prices of table oils in the Moroccan market are due, on the one hand, to the structural shortcomings that characterize the value chain associated with oil crops and the production of table oils. On the other hand, due to circumstantial factors associated with fluctuations in the prices of oily raw materials on the international market, as well as the rise in energy costs and the transportation of goods at the international level, in addition to the adoption of a traditional distribution network.
Bouazza Al-Kharti says about consumer protection associations, in an interview with Al-Jazeera Net, that the consumer is waiting for the recommendations of the Competition Council to be implemented, and waiting for the government’s reaction to fix the imbalance in the oil market.
The spokesman noted the increase in the value-added tax on oils, which amounts to 10%, the multiplicity of distribution intermediaries, and the absence of competition.
“We demand the government to reduce the added value and control the distribution that is witnessing chaos in various sectors, and the need for the Ministry of Commerce to intervene to control the level of distribution, and we demand respect for competition,” he said.
Al-Kharti stressed the need to download the contents of the royal speech, which emphasized the adoption of a strategic policy in basic articles to ensure food and energy security, and considered that the actors in the sector were not at the required level.
In a related context, distribution dealers rejected their accusation by the Competition Council of contributing to the rise in prices, and Taher Abou El Farah (President of the Renaissance Association of Traders in Casablanca) confirmed that the profit margin of traders and distributors does not change whether prices rise or fall, stressing that the high price The source is from the manufacturers and the international market.
According to the Planning Commission, consumption prices are expected to witness an estimated increase of 2.4 percent, according to the annual change, due to the rise in food prices, which is due to the rise in international prices of food raw materials, especially vegetable oils and grains.