Agriculture In Mena - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

Agriculture In Mena - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The agriculture market in the MENA region is projected to record a CAGR of 5.7% during the forecast period 2022-2027. The COVID-19 pandemic led to increased consumption of healthy and nutritional diets that enhanced the consumption of cereals and fruits in the region. However, human movement restrictions due to the COVID-19 pandemic have resulted in farm labor shortages, especially for high-value crops.

MENA is an acronym that refers to the countries in the Middle-East and North Africa. The Middle-East and North Africa region comprises 14 low and middle-income countries or territories stretching from Iran to Morocco. The region supports a population of 296 million people, over 120 million of whom live in rural areas. Of these, about 84 million are dependent on agriculture, including fishing and livestock. The region covers an area of 1100 million hectares and includes diverse environments. Rainfed crops are grown during the wetter winter period, while irrigated areas are cultivated year-round. The main rainfed crops are wheat, barley, legumes, olives, grapes, fruit, and vegetables. A wide range of subtropical crops, including fruit and vegetables, is also grown under irrigation in the summer months. Livestock, mainly sheep and goats, are an important feature of many farming systems and provide key linkages between and within the different systems. Water-efficient irrigation is expanding and enabling intensive production of high-value cash and export crops, chiefly including fruits and vegetables. A dominant concern in the MENA region is its high and growing dependence on the international markets for key staple food products, as arable land and water grow scarcer. The governments of various countries have taken steps to conserve water by banning the production of water-thirsty crops, such as wheat and green fodder. Food demand is increasing in the MENA region, mainly for two key reasons, which include population growth and rising incomes. According to the Food and Agricultural Organization (FAO), the land reform issue remains one of the most intractable, as many people hold onto their fragmented holdings without any rationalization or consolidation processes in place, even where countries are officially undertaking land reforms. The only places where there have been major changes are where larger operators have been able to buy out smaller farmers. It is widely recognized that the reorganization of land holdings is a prerequisite for the introduction of technologies that will conserve soil and water resources in the long run. Thus, the proper use of agricultural resources, new technology, and favorable policies are expected to be crucial in driving the agriculture sector of the region during the forecast period.

Key Market TrendsQuest for Food Self-sufficiency Driving Production

Among the food security challenges in the region, undernourishment, poverty, low agricultural productivity under scarce natural resources, and food import dependency pose the main problems. To tackle the increasing dependency on imports, countries in the region are taking several measures to ramp up production, as there are opportunities to partially address food insecurity by increasing production. For instance, a political blockade in Qatar turned into a boon for its food security as the Ministry of Economy and Commerce (MEC), in cooperation with shopping malls and large retail outlets, unveiled the “National Product” of the "Made in Qatar" initiative. Under this initiative, farmers are growing fruits and vegetables in greenhouses, which are being sold as goods bearing the slogan “National Product” prominently to facilitate consumers’ access to these products. In another instance, according to a recent FAO report titled “The State of Food Insecurity in the World,” Morocco has made significant progress in the reduction of hunger by maximizing production from large-scale farms and supporting small-scale farms in reducing poverty and hunger through venture capitalism. The production of coarse grain grew from 777,120 ton in 2016 to 3,005,008 ton in 2018 (FAO). Similarly, in North Africa, the production of fruits and vegetables showed a significant rise in 2019 in comparison to 2017, with a production of 34.62 million ton of vegetables and 35.09 million ton of fruits in 2019. Thus, the quest for achieving food self-sufficiency is majorly driving agricultural production in the MENA region.

Egypt Dominates Fruit and Vegetable Production

Egypt is the highest producer of fruits and vegetables in the region, closely followed by Iran. Fruits and vegetables are the most suitable crops for the climatic conditions of countries in the MENA region. The countries in the region direct their scarce water resources to more value-added crops, like fruit and vegetables grown in greenhouses, as opposed to growing water-intensive cereal crops. According to FAO, Egypt produced 15,524,952 ton of primary fruits and 15,419,841 ton of primary vegetables in 2019. Egypt is also a significant exporter of fruit and vegetables to the European Union. Major fruits and vegetables produced in the region are grapes, dates, watermelon, bananas, sugarcane, eggplants, and potatoes. According to FAO, the production of fruits and vegetables in Egypt amounted to 30 million ton in 2019. In fruits, oranges recorded the highest production of 3 million ton. Similarly, among vegetables, tomato recorded the highest production of 6.7 million ton, followed by onions with 3 million ton in 2019. Hence, the production of fruits and vegetables is likely to drive the whole agricultural sector in the country during the forecast period.

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