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Tomato prices edge higher during September 2020

October 9, 2020

1 mins read

The Mintec price of Spanish tomatoes increased by 33% to EUR 2.58/kg in the four weeks to 30th September.

The bullish sentiment evident in the Spanish tomato market can be attributed to a drop in production for the 2020 season, due to tomatoes facing more local competition amongst farmers. In  July 2020, the European Commission reported that the European Union’s tomato production would be 2% lower year on year, due to a 7% decline in Spanish production.

Spanish producers are switching to alternate greenhouse vegetables that are financially more profitable than tomatoes. Several factors have impacted Spanish farmers decision to grow other vegetables, including tomato productions requirement of vast amounts of labour, particularly in a COVID-19 environment, where Spain relies heavily on a migrant labour force.

In light of this, European imports of Moroccan tomatoes have exceeded those exported from Almeria (Spanish region) for the first time in July 2020. Moroccan tomatoes are reported to be price competitive in Europe, due to having a cost advantage in production.

EU imports of Moroccan tomatoes are expected to remain high, in line with a continuous steady decline in Spanish tomato production volumes. Spanish tomato exports declined by 26% over seven consecutive seasons. The country exported 985.34 million kilos of tomatoes in the 2013/14 campaign, compared to 728.79 million kilos in the most recent season.

Overall, the Spanish tomato price is expected to extend its upward trend for the remainder of the year, underpinned by fundamentals. Also, the possibility of logistical issues amidst COVID-19 is likely to continue to impact the Spanish agricultural labour force.

Ramnikh Kular

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