Navigating the Heat: Tomato Market Uncertainty Amidst Europe’s Drought
Europe is sweating, and it’s not just the people feeling the heat. The continent’s key tomato-growing regions are struggling with the effects of consecutive years of drought, causing a ripple of uncertainty in the tomato market. Add to this the scorching heatwaves that have become an almost annual occurrence since 2015, with the sole exception of 2016, and it’s clear the industry is under pressure.
Spain: A Troubling Tomato Tale
In Spain, a country renowned for its juicy, ripe tomatoes, the situation is particularly concerning. Estimates suggest a worrying Year-on-Year decrease in tomato production yield by 30%. To counterbalance this, the agricultural focus has shifted towards increasing the planted area, specifically in the western region of Extremadura and the southern region of Andalucía. However, the critically low water levels in the reservoirs pose a significant challenge for irrigation.
In response to this troubling trend, Spain has pivoted its import strategy, sourcing processed tomatoes from Morocco and Egypt rather than China. As raw material prices have seen a sharp rise over the past two years, leaping from €78/mt in 2021 to €102 in 2022 and reaching a high of €150 ex field as confirmed in March 2023.
Italy: Negotiations in the North and South
Italy, another cornerstone of European tomato production, is also feeling the strain of the extreme weather conditions. As negotiations for raw materials unfold in both the northern and southern regions, tensions are mounting. Processors in the north have offered approximately €130 for raw materials, but growers are demanding €150. The stakes are high, especially with recent flooding in Emilia Romana, a region responsible for 30% of Italy’s tomato cultivation. The exact impact on the crop is yet to be confirmed, but there’s no doubt this event will play a significant role in upcoming negotiations for processed tomatoes.
Hope on the Horizon: Turkey and Egypt
It’s not all doom and gloom for the tomato industry, however. Turkish and Egyptian tomatoes are predicted to perform well this year. With no concerns about rainfall in Turkey, the planting of tomato seedlings in Bursa and Balikesir is going ahead full steam. Pricing typically occurs at the point of harvest in August – September, so we’ll be keeping a close eye on this region.
The Egyptian early summer crop is also well underway, with prices currently sitting around $130 USD ex. field. Given that Egyptian tomatoes are produced all year round, the pricing will continue to evolve throughout the year.
Looking Ahead
As we navigate through these challenging times, it’s crucial to stay informed and adapt to the changing conditions. The drought and extreme weather events are stark reminders of the impact of climate change on our agriculture and food supply.
We’re here to help you stay ahead of these changes. For more information or assistance, please get in touch or visit our full tomato catalogue page here. We’ll continue to keep you updated on the latest in the tomato market as we weather this heatwave together.
