×

Morocco delays target date to cap sugar imports

* Morocco delays target to 2020

* Delay comes as monopoly seeks new buyers

By Souhail Karam

RABAT, Oct 2 (Reuters) - Morocco is to delay a plan to cap sugar import needs at 45 percent its annual demand by end-2013 after bad weather hit farming this year and as an investment vehicle controlled by the ruling monarchy seeks to divest the sugar industry's monopoly.

In a statement carried by the official MAP news agency, the agriculture ministry said the government would draft a new development plan for the sugar industry that aims to have 53 percent of domestic sugar demand produced locally by 2020.

The ministry said currently 35 percent is produced locally, which means Morocco will need to import close to 850,000 tonnes of raw sugar in the 12 months till end-May, 2013. The ministry did not elaborate.

With a population of 32 million people, sugar consumption per capita in Morocco stands at around 90 pounds, or an annual 1.3 million tonnes.

In the eight months to end-August, Morocco imported 691,300 tonnes of raw sugar, of which 60,000 tonnes was during August alone, at an average price of 5,295 dirhams ($610) per tonne, data from the foreign exchange regulator showed.

Under a previous government-sponsored development plan launched in 2008, farmers and private sugar monopoly Cosumar

agreed to raise homegrown sugar output by 45 percent to 675,000 tonnes, or 55 percent of domestic needs by 2013.

Besides scarce rainfalls this year, tensions between farmers and Cosumar and floods during the two previous years have had a negative impact on the plan.

Since its launch, no steps have been taken to open up the sugar industry and tensions between Cosumar and farmers in the last year have threatened to halt the delivery of their sugar beet crop due mainly to what they say are unfair terms.

Driss Ghezlaoui, a sugar beet farmer from the Doukkala region, said sugar beet-planted areas in an area that usually produces 40 percent the country's sugar beet had actually shrunk since the plan was launched in 2008.

"The (2008-2013) plan projected that sugar beet would cover 25,000 hectares this year. Today, it stands at 5,000 hectares," Ghezlaoui told Reuters. "The difficulties between Cosumar and farmers prevented this plan from delivering its objectives because there is no fair trade here," he said.

Cosumar holds a monopoly in the processing of the local sugar beet and cane harvest and refining of raw sugar imported mostly from Brazil and India. Its majority shareholder is National Investment Co (SNI), an investment vehicle in which the ruling monarchy is the biggest shareholder.

SNI has listed its 63.7-percent stake in Cosumar - which has a market value of $800 million - among assets up for sale under a portfolio restructuring plan to focus on sectors such as tourism, telecoms and renewable energies.

($1 = 8.6108 Moroccan dirhams)

(Editing by James Jukwey)

((souhail.karam@thomsonreuters.com))

Keywords: MOROCCO SUGAR/COSUMAR