Casablanca – Morocco is extending its suspension of subsidies for soft-wheat imports through the month of December, continuing a trend that has remained in place for several months. The decision is supported by a period of stability in international grain markets, allowing the government to avoid activating compensation mechanisms normally used to support millers and importers.

The National Interprofessional Office of Cereals and Pulses (ONICL) confirmed that no subsidy will be allocated this month for the importation of soft wheat intended for milling. This reflects an unchanged situation since April, when global soft-wheat prices consistently fell below the Moroccan reference level of around $28

The reference price plays a central role in Morocco’s wheat-import policy. When the international price of soft wheat surpasses this threshold, ONICL activates what is known as the “flat-rate compensation,” a financial mechanism designed to offset cost increases for importers. In years marked by global price volatility, this compensation has at times exceeded  $1.5. However, international prices have remained below the reference benchmark for months, making additional state intervention unnecessary.

This alignment between global and domestic prices has contributed to market stability at a time when Morocco continues to rely heavily on wheat imports. The country’s strong dependence on soft wheat, especially for bread and flour production, means that changes in global markets can quickly affect local consumer prices. To prevent sharp increases in basic food costs, the government adjusts domestic pricing frameworks in line with international price movements.

Current conditions have allowed Moroccan mills to acquire imported soft wheat at prices that do not exceed the government’s adopted threshold of $28 per quintal. As a result, the subsidy level remains at zero, reducing fiscal pressure on the state and supporting a more predictable trading environment for importers.

However, the sector is still expecting new regulatory guidance. Grain importers, distributors, and milling operators are awaiting an upcoming circular from ONICL that will outline the procedures, pricing rules, and potential compensation mechanisms that will apply during the first four months of the coming year. Such directives are important for supply chain planning, especially during a period when global markets may face new uncertainties related to climate events, geopolitical tensions, or supply fluctuations from major wheat-exporting countries.

At the same time, Morocco continues to operate a special program aimed at reinforcing national soft-wheat imports. This program remains in force until the end of December and was introduced to secure the country’s grain supply following several years of declining domestic production. Prolonged drought conditions and insufficient rainfall have significantly reduced the output of rain-fed agricultural areas, which make up a large portion of Morocco’s cereal-producing regions. Because of this, the country has increasingly depended on imports to meet national demand.

The continued implementation of this import-support program is based on a joint decision previously issued by the Ministry of Economy and Finance and the Ministry of Agriculture, Fisheries, Rural Development, Water and Forests. The program ensures that Morocco can maintain sufficient reserves and avoid supply disruptions, especially during years when local harvests fall short of expectations.

Economists note that while the suspension of compensation payments eases fiscal burdens, it does not erase the structural vulnerabilities in Morocco’s grain sector. Climate change, water scarcity, and shifting global market conditions all contribute to long-term uncertainty. Mechanisms such as ONICL’s reference pricing and compensation structure remain essential tools for stabilizing the market, even if they are not currently activated.

For now, the continuation of the zero-subsidy policy reflects confidence in prevailing international conditions. Nevertheless, upcoming policy updates early next year will determine whether Morocco continues to benefit from this favorable price environment or whether renewed market fluctuations may require the reinstatement of financial support to protect mills, bakers, and consumers.