"Morocco Agribusiness Report Q1 2011" is now available at Fast Market Research

Dec. 16, 2010 - PRLog -- In the five years to 2015, we anticipate strong production growth for most agricultural sectors. However, growth is expected to be particularly high in the case of livestock and dairy produce, as well as corn and sugar. Corn production will expand from a relatively low base, fuelled by a demand for the grain as a form of animal feed. The production of livestock and dairy produce will benefit from the steady expansion of Morocco's economy and from rising per capita incomes. Meanwhile, the sugar industry stands to benefit from strong government support and efforts to raise output. Over our five-year forecast period, positive demand growth is envisaged for all Morocco's agricultural sectors; we expect growth in the consumption of poultry, beef, milk and sugar to benefit from rising living standards and by an expanding population. However, although BMI is predicting steady growth for Morocco's economy, a double-dip recession for the global economy would also affect Morocco. Per capita income would inevitably be affected, forcing consumers to cut back on the consumption of meat, dairy produce and sugar in favour of staple foods.

Key Industry Forecasts

* Wheat is a staple food in Morocco. Due to poor harvest and the impact of drought, production of the grain is predicted to fall to 4.47mn tonnes in 2010/11 from 6.31mn tonnes in the previous year. Long-term production growth is expected to be steady but not impressive, with output predicted to rise by around 5.8% per year to 2014/15.
* Demand for wheat will grow by 2% in 2011 to 7.85mn tonnes, up from 7.68mn tonnes in 2010. Based on rising demand for a wide range of wheat-based products, demand for the grain is predicted to rise by 12% over the five years to 2015. Morocco is expected to remain highly dependent on wheat imports to satisfy overall demand.
* Other key grains include barley and corn, both of which are predominantly used for animal feed. Growth in corn production is predicted to be particularly strong in the five years to 2014/15, rising by 14% over our forecast period to 233,400 tonnes. Production will benefit from a growing demand for animal feed.
* Livestock Production Forecast, 2010-2015: Poultry: 29%; Beef: 21% - fuelled by strong domestic demand for meat, as well as government support for modernisation and expansion initiatives.
* Dairy Production Forecast, 2010-2015: Milk: 24%; Cheese: 18% - fuelled by rising consumption demand, especially in the case of higher-value dairy products. Production will also benefit from the adoption of more productive technology and the introduction of higher-yielding, quality producing cows.
* Sugar Production Forecast, 2010-2015: 28% - supported by government initiatives to double production by 2013. Improvements are expected in key areas, including irrigation, improved farming methods and greater access to inputs such as fertilisers.

Key Macroeconomic Forecasts

* Morocco Real GDP Growth: Estimated to slow to 3.6% y-o-y in 2010 from 4.6% in 2009, before recuperating to average 4.0% y-o-y over the 2011-2014 period.
* Morocco Private Consumption Growth: Estimated to grow by 3.0% y-o-y in 2010, and then average 3.8% throughout the remainder of our forecast period.
* Morocco Unemployment: Estimated at 9.9% in 2010, although predicted to fall in 8.5% in 2012.
* Morocco Core Inflation: Estimated to have reached 2.0% in 2010 and predicted to remain at this rate in 2011. The main driver of headline inflation is food, which accounts for 40% of the consumer price basket.

Key Views

The livestock industry, particularly the poultry and beef sectors, offer considerable opportunities for future investment and development. In recent years, livestock production has already benefited from increased investment as producers look to address growing demand. Demand for poultry has been especially robust, with consumption growth reflecting an expanding population and rising GDP per capita. Meanwhile, emerging fast food outlets are boosting demand for processed meats. Although this is expected to be partially met though imports, domestic production also stands to benefit. In the five years to 2015, we predict that poultry output will increase by over 29%, reaching 681,400 tonnes.

The production of value-added dairy products offers the highest growth opportunities for dairy producers. Demand for cheese and butter are both forecast to grow strongly. In 2015, 101,600 tonnes of butter and 18,600 tonnes of cheese are forecast to be consumed by Moroccans following five-year growth of 32% and 18% respectively.

Morocco has one of the highest per capita sugar consumption figures in the world. This has been aided by government subsidies supporting artificially low prices. Although these government subsidies are expected to be gradually lifted sugar consumption is still forecast to grow steadily through to 2015. This will primarily be driven by higher demand for value-added sugar confectionery and soft drinks resulting from higher disposable incomes. This will result in 13% growth in sugar consumption between 2010 and 2015.

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Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available.