Russia asks Morocco to cut wheat import tax to 30% by year end


Russia’s agriculture minister has told his Moroccan counterpart that he expects the country to cut its import tax to 30% by the end of 2018 as Russia looks to develop new export markets, the Russian Ministry of Agriculture said.

Morocco hiked its wheat import tax to 135% on May 11, and its rate for preferential trading partners – including the EU and the US – from 9.9% to 83.7%.

That came as its domestic wheat production is set to top 8.2 million mt this year, nearly 1 million mt more versus last year as it ideal weather conditions have boosted crop size.

“The Russian side expects a reduction in duties from 135% to 30% by the end of the year, which will further increase the interest of domestic companies to work in the Moroccan market,” the Russian ministry said in an update.

The move comes in stark contrast to recent global market worries around a potential restriction of Russia’s wheat exports this year after the country’s production slid over 20% following unfavourable weather.

Of the 5.5 million mt of wheat that Morocco imported after its crop failed in 2016/17, Russia contributed 18%, on par with Ukraine’s share.

Both were behind the EU’s share at 31%, while the US came in fourth at 16%.

However, high stocks and rising domestic production over the past two years has seen wheat imports fall and import taxes rise, with import requirements for 2018/19 expected at 3 million mt, some 14% lower on the year, USDA data showed.

Morocco uses wheat import taxes as a lever to protect domestic farmers as well as regulating local wheat prices and stock levels.

Tariffs on durum wheat are more predictable, as domestic production has been on the decline, while import requirements have been steady.


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