Focus on Tunisia

by Chris Lyddon
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For the size of its population, Tunisia, on the coast of North Africa, is a big consumer and importer of grain. The government operates measures to manage the market, and political upheavals in recent years mean that change has been slowed.

According to the International Grains Council (IGC), Tunisia will produce 1.2 million tonnes of wheat in 2013-14, down from 1.4 million the year before. It is forecast to import a total of 3 million tonnes of grain, up from 2.8 million, the year before. That includes 1.7 million tonnes of wheat, up from 1.5 million, and an unchanged 700,000 tonnes of maize, along with an also unchanged 500,000 tonnes of barley.

Tunisia has one of the highest rates of per capita consumption for wheat in North Africa, estimated at 258 kg per year with total wheat consumption at around 2.8 million tonnes per year, the USDA attaché said in an annual report on the sector for 2013. “Wheat consumption is expected to remain high for the next few years.”

The same report put Tunisia’s barley and maize consumption at about 850,000 tonnes a year for each product.

At the time of the report, the attaché expected Tunisia’s wheat imports in 2012-13 to reach 1.7 million tonnes.

“Shipments from Russia, Ukraine, France and Italy accounted for the majority of Tunisia’s wheat imports,” the report said, noting that wheat imports from the U.S., primarily durum wheat imported by private millers, totaled 20,000 tonnes in 2012-13, or about a 1% share of the market. Russia and Argentina dominated barley imports, while Argentina and the Black Sea suppliers are the main sources of maize, beating the U.S. on price.

POLICY

The attaché explained that Tunisia’s government is continuing to implement a strategy to boost cereal production that started in 2008.

“Through its cereals office, the government continues to control wheat imports by issuing tenders to international traders with import criteria based mostly on price considerations,” it said. “In the last few years, the state monopoly ‘Office des Céréales’ purchasing policy has been more price-oriented with less emphasis given to the quality attributes of imported wheat.”

“Private sector millers have often complained about the low milling quality of some imported shipments that have been forced on them by the Cereals Office,” the report said. “At present, private operators can import wheat directly but only if they re-export their final products and do not sell the products in the Tunisian market. Some private millers could expand imports from the U.S. in the next coming years.

“There is some indication that the government may consider a partial liberalization of the wheat sector and allow the private sector to participate in wheat imports. It is not certain if and when this partial liberalization will take place.”

FLOUR MILLING

According to the website of Tunisia’s national Cereals Office, the country has 25 flour mills, 18 located on the coast near the country’s four major ports with eight in the Greater Tunis area (accounting for 53% of national capacity), four in Sousse, three in Sfax and three in Gabes. The five remaining units are located inside the country in the governorates of Nabeul, Beja, Jendouba, Gafsa and Kasserine. The office puts total national milling capacity at 2 million tonnes. Britain’s HGCA, which views Tunisia as a potential export market, put the total at 23 mills.

“The U.K. hasn’t exported wheat to Tunisia since 2011 and this is due to high prices,” Sarah Mann, manager of HGCA’s British Cereals Exports (BCE) arm, told World Grain. “The Office de Céréales is responsible for importing wheat and distributing it at a regulated price and therefore are looking for the lowest price option.

“Private companies are able to import direct, but there is no profit to be made between the international market and the fixed Tunisian price, therefore they are happy to take the Office des Céréales imported wheat at the lower fixed price. We have, however, exported a considerable amount of barley to Tunisia this season. They have taken over 100,000 tonnes, or 14% of our exports, making them our second largest customer this year (Netherlands being the first).”

BCE focuses on biscuit production because of the properties of U.K. export wheat for making biscuits.

“They use 2.8 million quintals of cereals to make around 70,000 tonnes of biscuits,” Mann said. “There are 18 biscuit manufacturers with the lion’s share being produced by the top four.”

HGCA cites Tunisian barley production at 375,000 tonnes in 2013-14, down from 450,000 tonnes the previous year, citing Tunisian ministry figures.

“Barley is consumed mainly as cattle feed in Tunisia and as a supplement feed, especially during shortages of good pasture land and forage crops,” an HGCA briefing paper on Tunisia said. “The private sector buys local barley production from farmers which are used for human consumption on local dishes like soups, barley bread and couscous. Barley is used for both feed (85%) and food (15%). Over time, local knowledge presented barley as a high energy and healthy food and barley also came to be used as a meal to break the fast during the holy month of Ramadan.”

BCE highlighted Tunisia’s relatively thriving beer market. “Tunisia has the most flourishing beer market in North Africa,” it said. “Consumption is about one million liters each year, which represents an average of 10 liters per inhabitant every year. By comparison, consumption in Morocco is about 950,000 liters each year and Algeria about 850,000 liters.”

OILSEEDS

In an annual report on the oilseeds sector, the attaché quotes agriculture minister figures putting production of olives in Tunisia at 400,000 tonnes in 2013-14, down more than 63% on the previous year due to bad weather and lack of rain. Olive oil production for 2013-14 is estimated at 80,000 tonnes, down from 220,000 tonnes. The attaché also noted that U.S. soybean exports at 220,000 tonnes took 52% of that market, while U.S. corn oil exports of 32,000 tonnes in calendar 2013 represented 56% of the market.

“Oilseed imports, principally consisting of soybeans, were maintained at the same level after a continuous increase that began in 2009 with the start of Tunisia’s first and only oilseed crushing plant, Carthage Grains,” the report said. “For 2013, total soybean imports were estimated at 421,000 tonnes, down from 440,000 tonnes the previous year. The decrease was due to two months operation disruptions at Carthage Grains because of social problems and strikes.

“Apart from olive production, Tunisia’s oilseed production remains insignificant despite the Ministry of Agriculture’s efforts to encourage farmers to grow rapeseed and sunflower crops in order to diversify oilseed production. Tunisia has about 75 million olive trees spread over one-third of Tunisia’s arable land, making the olive crop the main domestic source of edible oils.”

BIOTECH

The attaché reported in September that “Tunisian legislation on biotechnology, drafted before the revolution, has been indefinitely postponed and most likely will not be approved until the election of a new parliament in 2014 and a new constitution is written.”

“Meanwhile, imports of biotech products into Tunisia will continue to be handled in a manner similar to that of conventional agricultural products,” the attaché said. “FAS/Tunis continues to assist in building Tunisia’s biotechnology research capacity through exchange programs and technical workshops.”

“There is no debate today on biotechnology in Tunisia since Tunisian awareness of this issue is very low,” the attaché said. “However, as a new democracy in transition, there will be an intense debate in the next few years between pro and anti-biotech opponents, mainly influenced by European Union policy regarding biotechnology issues.

“Although Tunisian officials recognize the existence of GE materials in imported animal feed products, the dependence of Tunisia’s agriculture on these imports, as well as their increased international acceptance, have allowed the import of these biotech products to continue.”

Key Facts

Capital: Tunis

Population: 10,937,521 (July 2014 est.)

Religions: Muslim (Islam - official) 98%, Christian 1%, Jewish and other 1%.

Location: Northern Africa, bordering the Mediterranean Sea, between Algeria and Libya.

Government: Republic. Chief of state: Moncef Marzouki (since Dec. 12, 2011); head of government: Prime Minister Mehdi Jomaa (since Jan. 29, 2014).

Economy: Tunisia’s diverse, market-oriented economy has long been cited as a success story in Africa and the Middle East, but it faces an array of challenges during the country’s ongoing political transition. Following an ill-fated experiment with socialist economic policies in the 1960s, Tunisia embarked on a successful strategy focused on bolstering exports, foreign investment, and tourism, all of which have become central to the country’s economy. Key exports now include textiles and apparel, food products, petroleum products, chemicals, and phosphates, with about 80% of exports bound for Tunisia’s main economic partner, the European Union. Tunisia’s liberal strategy, coupled with investments in education and infrastructure, fueled decades of 4-5% annual GDP growth and improving living standards. Former President Zine el Abidine Ben Ali (1987-2011) continued these policies, but as his reign wore on cronyism and corruption stymied economic performance and unemployment rose among the country’s growing ranks of university graduates. These grievances contributed to the January 2011 overthrow of Ben Ali, sending Tunisia’s economy into a tailspin as tourism and investment declined sharply. During 2012 and 2013, the Tunisian government’s focus on the political transition led to a neglect of the economy that resulted in several downgrades of Tunisia’s credit rating. As the economy recovers, Tunisia’s government faces challenges reassuring businesses and investors, bringing budget and current account deficits under control, shoring up the country’s financial system, bringing down high unemployment, and reducing economic disparities between the more developed coastal region and the impoverished interior.

GDP per capita: $9,900 (2013 est.); inflation: 6.1% (2013 est.); unemployment: 17.2% (2013 est.).

Currency: Tunisian dinars (TND): 1.57 dinars equal 1 U.S. dollar (March 19, 2014).

Exports: $17.46 billion (2013 est.): clothing, semi-finished goods and textiles, agricultural products, mechanical goods, phosphates and chemicals, hydrocarbons, electrical equipment.

Imports: $24.95 billion (2013 est.): textiles, machinery and equipment, hydrocarbons, chemicals, foodstuffs.

Major crops/agricultural products: Olives, olive oil, grain, tomatoes, citrus fruit, sugar beets, dates, almonds; beef, dairy products.

Agriculture: 8.6% of GDP and 18.3% of the labor force.

Internet: Code: .tn; 576 (2012) hosts and 3.5 million (2009) users.

Source: CIA World Factbook

Chris Lyddon is World Grain’s European editor. He may be contacted at: chris.lyddon@ntlworld.com.


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