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Olive Oil Crisis in Morocco – Rising Prices and Strategic Imports Amid Declining Production
With a projected 11% decline in olive oil production for the 2024/2025 season, the cost of this staple food has surged to unprecedented levels, sparking concern among consumers. Amidst discussions of strategic imports and grim climatic forecasts, questions arise about the future of one of Morocco's most essential commodities.
Low Yields and Rising Production Costs
The Ministry of Agriculture recently announced that olive production this season is expected to be 11% lower than last year and 40% below average. This decline, primarily driven by persistent droughts, is the root cause of soaring prices. Morocco’s olive sector is not alone in facing this challenge, as global production fell by 8% during the 2023/2024 campaign.
Rachid Benali, president of the Moroccan Interprofessional Federation of Olives (Interprolive), cited extreme heatwaves and water scarcity as major obstacles. "Olive trees need water, whether rain-fed or irrigated. Without water, production suffers," he stated. He also highlighted that input costs, including fixed agricultural expenses, exacerbate the issue. "When yields are low, the cost per unit increases significantly, pushing up the overall price," he explained.
Strategic Imports to Ease Shortages
In response to dwindling supply and skyrocketing prices, Morocco has turned to imports to bridge the gap between demand and availability. The government has authorized duty-free importation for a quota of 2,000 tons from Europe, with an additional 10,000 tons exempted from duties by the end of the year.
"The goal is to curb inflation on this essential product," Benali explained. Tunisia has also emerged as a key partner, with no restrictions on duty-free imports. However, the focus remains on high-quality extra virgin and virgin olive oil to maintain consumer standards.
Will This Solution Work?
While imports are expected to stabilize prices, their long-term efficacy remains uncertain. Benali expressed cautious optimism, stating that authorities would reassess the impact of these measures by year’s end to determine whether further adjustments are needed.
Climate Challenges and Future Prospects
The outlook for the olive sector remains uncertain amid prolonged droughts. While Benali acknowledged setbacks in regions like Marrakech-Safi, he remains optimistic about the industry's resilience. He cited the example of Spain, which bounced back with strong production this year after a poor previous season.
“With adequate rainfall and efficient irrigation techniques, Morocco can recover quickly,” he asserted, emphasizing the olive tree's natural resilience.
For now, Morocco’s olive oil industry faces a delicate balancing act between addressing immediate shortages and ensuring sustainable growth. Strategic imports may offer temporary relief, but the sector’s future hinges on improved water management and climate adaptation strategies.