Medfrol Project. Market and Trade Policies for Mediterranean Agriculture: The case of fruit/vegetable and olive oil

Transcription

1 Medfrol Project Market and Trade Policies for Mediterranean Agriculture: The case of fruit/vegetable and olive oil SIXTH FRAMEWORK PROGRAMME PRIORITY 8.1 Policy-oriented research Integrating and Strengthening the European Research Area Call identifier: FP SSP-1 NATIONAL AGRICULTURAL SITUATION REPORT FOR TUNISIA By Lassaad LACHAAL, Boubaker DHEHIBI 1, Ali CHEBIL, Aymen FRIJA and Chokri THABET Research conducted under the European sixth framework program (Priority 8.1) Integrating and Strengthening the European Research Area. Views expressed in this paper are those of the authors and do not necessarily reflect those of the institutions of affiliation, the Medfrol project or the EU. Any errors in the present report are the responsibility of the authors. 1 Corresponding author: Department of Agricultural Economics, INRAT. Rue Hédi Karray, 2049 Ariana, Tunisia. Tel.: / Fax: / bdhehibi@aragon.es No senior authorship is assigned.

2 AGRICULTURAL SITUATION REPORT FOR TUNISIA By Lassaad LACHAAL, Boubaker DHEHIBI, Ali CHEBIL, Aymen FRIJA and Chokri THABET 2

3 TABLE OF CONTENTS Page LIST OF TABLES 4 LIST OF FIGURES 5 LIST OF APENDIXES 5 1. INTRODUCTION 6 2. NATURAL CONDITIONS AND LAND USE Land Resource Potential and Constraints Water Resource Constraints Land and Water Use 8 3. PERFORMANCE OF AGRICULTURAL SECTOR Introduction Products Intermediate Inputs Machinery and Equipment Water Uses Labor Force and Employment in Agriculture Price and Incomes UPSTREAM AND DOWNSTREAM SECTORS Upstream Sectors Food Processing Sectors FOOD CONSUMPTION TRADE IN AGRI-FOOD PRODUCTS Structure of Trade in Agri-Food Products Trade Performance of Agri-Food Products Trade Performances: Fruits, Vegetables and Olive Oil INTERNATIONAL COMPETITIVENESS OF THE MEDITERRANEAN FRUITS, VEGETABLES AND OLIVE OIL SECTORS MEDIUM-TERM OUTLOOK CONCLUDING REMARKS 25 REFERNCES 25 TABLES 27 APPENDIXES 43 3

4 LIST OF TABLES Table 1: Land constraints Table 2a: Exploitable water resources in Tunisia (millions m 3 ) Table 2b: Accessible and available waters in Tunisia for different time horizons (Mm3 yr-1) Table 2c: Current irrigation schemes and water sources Table 3: Fresh fruits products (1000 tons) Table 4: livestock products (1000 tons) Table 5: Vegetables products (1000 tons) Table 6: Agricultural products in value (1000I$) Table 7: Major fruit and vegetable yields (T/ha) Table 8: Tunisian aggregated fertilizers consumption (1000 tons; average of three years) Table 9: Tunisian evolution of aggregated fertilizers consumption (mile tons) Table 10: Weeded surfaces of cereals in the north of Tunisia Table 11: Total number of tractors Table 12: Evolution of cultivated surface per tractor (ha/tractor) Table 13: Water use by sector Table 14: Irrigated areas and irrigation techniques (ha) Table 15a: labor force and employment in agriculture Table 15b: Table 15b: Labor force and employment in agriculture Table 16: Producer price of the principal agricultural produce, (Unit: DT/Tons) Table 17: Economic accounts of agriculture: Total results. Unit: (1000 TDN) Table 18: Import of fertilizers and pesticides (1000 TDN) Table 19: Tunisian trade in machinery (1000 TDN) Table 20: Some Indicators of food processing sub-sectors ( ) Table 21: Consumption of major food products (Kg/year/capita) Table 22: Self sufficiency ratio for major agricultural products (%) Table 23: Structure of trade in agri-food products Table 24: Agricultural products exports by commodity (1000$) Table 25: Agricultural imports by commodity (1000$) Table 26: Value and sources of Tunisian imports for major agricultural products ( ). Table 27: Value and markets of Tunisian exports for major agricultural products ( ). Table 28: General trade performance of fresh and processed food Table 29: Position of Tunisia in 2002 for some trade indexes Table 30: Sources of competitiveness and its various components Table 31: Structure of Tunisian olive oil trade (Tons) Table 32: Structure of Tunisian fresh oranges trade (Tons) Table 33: Tunisian trade of oranges juice and concentrated oranges juice (Tons) Table 34: Structure of Tunisian fresh tomato trade (Tons) Table 35: Tunisian trade of tomato juice and tomato pasture (Tons) Table 36: General trade performance of olive oil, tomato and citrus: some indexes Table 37: Domestic Resource Cost for tomato, citrus and olive oil Table 38: Competitiveness and cost composition of Tunisian olive oil 4

5 Table 39: Competitiveness and cost composition of Tunisian harvest tomato Table 40: Competitiveness and cost composition of Tunisian oranges LIST OF FIGURES Figure 1: Exploitable water resources Figure 2: Majors fresh fruits products Figure 3: Livestock products Figure 4: Majors vegetable products Figure 5: Value added of total industrial sector and food processing sector (constant price 1990) Figure 6: Structure of Agri-food trade LIST OF APPENDIXES Appendix 1: Production, Consumption and Export of olive oil Appendix 2: Area, Production, Yield, Consumption and Exports of Citrus Appendix 3: Citrus prices Appendix 4: Tomatoes areas and production Appendix 5: Tomatoes prices Appendix 6: Area and Potatoes production Appendix 7: Potatoes prices Appendix 8: Cereal production, areas and yields Appendix 9: Trends in cereal production prices Appendix 10: Trends in average import prices for cereals (dollars/ton) Appendix 11: Total wheat production and import. Appendix 12: Vegetable surfaces, production and yields Appendix 13: Fruits surfaces, production and yields Appendix 14: Fishing production (In thousands of tons) Appendix 15: Wine production and exports (thousands of hectoliters) Appendix 16: livestock for production (In thousands of heads) Appendix 17: production of red meat and milk (in thousands of tons) Appendix 18: poultry production Appendix 19: Food export value 5

6 1. Introduction The agricultural sector in Tunisia preserves an undeniable social and economic importance. It contributes with 28 % to the active population employment and 14 % to the gross domestic product (GDP). However, these contributions show significant fluctuations as a consequence to the variability of the climatic conditions and the evolving policies of the government regarding the sector. The rainfall pattern in Tunisia is irregular in space and time with strong rains which produce a fast streaming likely to cause an excessive erosion of ground and violent floods. Rainfall intensity varies between a maximum of 1500 mm in the North-West and a minimum of 50 mm in the South. It is concentrated on the winter period and known as a strong national variability. The decade 1990 was predominated by the dryness. For the whole nation, we raised four dry years; one wet (humid) year, three years that were relatively dry and one average year. For the South, the decade was entirely dry. Average outputs exhibit significant fluctuations due to the great dependence of the rain crops (such as the olive-tree) of the climatic conditions and consequently their variability. In 2002, particularly dry year, areas and productions of cereals were only 73 % and 41 % of the averages of the last decade respectively. In addition, olive production, (rain crops), during the last decade was correlated with average annual rain intensity. Livestock contributes to the total value added of the agricultural sector by million TND (current prices) against a value of million TND (current prices) for the vegetable productions. As for the fruits sub sector, the olive oil generally occupies the first place in terms of participation in the total agricultural value added as it contributes by 42 % of exports of the Tunisian agro-food sector and approximately 25 % of world olive derived exports. The tree crops are ranked first relatively in term of area with million ha, of which 65 % are located in the central regions. They represent 54% of the cultivated lands and constitute the specialization of the southern and central regions where they represent 75 % and 84% of cultivated land, respectively. The practical and principal crops are oil olive, table-olives, dates, citrus fruits, grapes, etc. Legumes and other industrial crops cover only 3% of cultivated lands and they are concentrated in the Northern areas. In Tunisia, the food processing sector accounts 5138 companies during the year The main agro-food processing and manufacture sub-sectors are related to cereals, olive oil, milk, tomatoes and canning industry of fish. The value added of this sector amount to million TND into 2001 which represents 17.6 % of the total manufacturing industries. The investment in this sector is million TND into 2001, which represents 20 % of the total manufacturing industries. The fruits and vegetables are transformed through 61 operational units, located in the north of the country and particularly in the Cap Bon region. 34 units are specialized in the production of tomatoes concentrate with a capacity of 34 thousand tons of fresh tomatoes per day. 6

7 2 Natural conditions and land use The climate varies from Mediterranean to arid. Total rainfall and distribution are highly variable from year to year and from the North to the South. Average annual rainfall is around 594 mm in the North, 289 mm in the Center, and 156 mm in the South; it ranges from 1500 mm in the extreme North to less than 100 mm in the extreme South (Zebidi, 1990). Mean annual rainfall values can be exceeded by factors of two to twelve during short and intensive rains producing heavy runoffs and causing soil erosion. 2.1 Land resource potential and constraints Fertile lands in Tunisia cover about 5 millions hectares. More than half of those lands (57%) are located in the Center, 11% in the South and 31% in the North. Forests and rangelands extend over a total area of 5.5 millions ha; the most part (60%) is located in the southern region, 23% in the Center and 17% in the North. The high-fertile soils do not exceed 3 millions ha, of which 500 thousands ha are suitable for irrigation. Of this latter area only 350,000 ha are being used at present (near 7% of all the area suited to be cultivated). The major part of the agricultural lands, forests and rangelands are situated on slopes (46 % of total Tunisian areas), which reduces their fertility and increases its exposure to erosion. Lands in Tunisia have been used since the ancient times. Besides, the continuous cultivation of less fertile lands even under difficult climatic conditions makes lands subject to water erosion increasingly so during the last decades reaching 3 millions ha. 71% of those lands are located in the northern zones and Cap Bon, and 22.7% in the high lands. In addition, more that one million ha are affected moderately too severally by this type of erosion. Land subject to desertification are located mainly in the south, 50 % of these lands are seriously or moderately affected by this category of degradation. However, Salinization affects more than 30 % of irrigated lands with different degrees (100 thousand ha) especially in elevated plains and oases (Ministry of Agriculture, 1996). Consequently, the degradation of these lands is expressed by a decrease in fertility of the irrigated zones, especially those where no preventive practices were observed such as drainage, lixiviation, etc (Table 1). 2.2 Water resources constraints Tunisian reserves of water are approximately estimated at 4.7 Billion m 3 /year. 2.7 Billion m 3 coming from annual rivers in the north, 0.7 Billion m3 as groundwater in the center, the plains and the coastal area and approximately 1.3 Billion m3 in the deep tablecloths mainly in the south (Table 2a). Water resources are unevenly distributed across the country with around 60% located in the North, 18% in the Center, and 22% in the South (Table 1). Water resources that have a salinity of less than 1.5 g L-1 are distributed as follows: 72% of surface water resources, 8% of shallow groundwater, and 20% of deep groundwater (Table 2b). Water resources management and planning are outlined in the country's five-year development plans. The goals are to mobilize most of the surface water through the completion of 42 dams and the construction of 203 hillside-dams, 1000 hillside-lakes, and 4000 recharge and floodwater diversion structures. The planned infrastructure in the year 2010, will account 87% of the potential (4760 Mm 3 ). In addition, the plans emphasize water harvesting and wastewater reutilization. 7

8 Million Figure 1: Water resource distribution in Tunisia North of Tunisia Center South Total surface w ater Deep aquifers Shallow aquifers Source: FAO database AQUASTAT Concerning water quality, Tunisia is known for its salted water: 30 % has a salinity of more than 3 g/liter. Water with less than 1.5 g/liter corresponds mainly to drinking water supply. In irrigated agriculture, principal water used has salinity from 2 to 3.5 g/liter succeeded by the water of salinity 3.5 to 4.5 g/liter Land and water use Tunisian total area is around 16.4 millions hectares, which 4.5 millions hectares of agricultural land and only around 3.5 millions hectares of effectively fertile soils. Agricultural lands are distributed into three main natural regions according to bioclimatic conditions and sensitivity. The different types of lands may be classified as follows: The North, with the North-East specialized in intensive mixed farming, growing of cereals and fruit farming; and the North west where land is allocated mainly to food grains and livestock ( intensive and extensive ); The Center: (i) The Sahel zone characterized with olive growing, cash crops and dry farming; (ii) the Center west and Kairouan are allocated to mixed farming and extensive livestock; The South arid region, with: (i) South East: olive growing, and fruit tree cultivation (littoral oasis); (ii) the South - west: tree crops, extensive livestock (Gafsa) (iii) continental Oases (Nefsaoua - Jerid and Région Maâtoug). About 25% of the Tunisian population is involved with the agricultural sector activities and 40% depend directly or indirectly on the income derived from this sector. The primary agricultural products of Tunisia are wheat, barley, citrus fruits, dates, olive oil, and vegetables. Citrus fruits and olive oil are the main export products. Major irrigated crops are vegetables and fruit trees, each contributing to more than 40% of the total irrigated agricultural production, cereals representing only 6%. In Tunisia, the total area suitable for irrigation is about ha of which 32% are in the North East, 31% in the Center - West, 22% in the North- West, 9% in the South and 6% in the Center East. Vegetable crops, large scale crops (cereals, farming industry, fodder crops and legumes) and fruit trees stretch out from to year around dams and drillings. This extension is greater in the Center West and the South in comparison with the other regions. It is in the Center and the South where salty waters are used to irrigate fine - textured soils (salty to salty clay) that requires additional care in the management of irrigation and drainage. 8

9 The phenomenon of salinization appears during dry periods, decrease in the out follow of drillings as well as intense irrigation, which results in the rising of the level of shallow aquifers: low plains of Medjerda and Kairouan, periphery of salt depressions and lakes, where drainage is nearly inexistent. Gravity irrigation (furrow or basin method) is the most commonly used irrigation system (75%) followed by sprinkler (20%), and drip irrigation (5%). 3- Performance of the agricultural sector 3.1 Introduction In order to allow better valorization and better contribution of the arable lands to the development process of development, public land policy aims at fighting against the abandonment of these lands, their under-use and their pronounced division and scattering. Within this framework, the improvement of land has interested the collective lands and their reorganization. This installation as well as the division of the exploitations between heirs constitutes the main factor which explains the significant stability of the farms number. The increase in the surface of arable land per farm is only 1.7% between 1960 and The land structures resulting from these factors are characterized by an increase of 44% in the farms number, passing from 326,000 covering a surface of 5.2 million hectares of arable lands at the beginning of the sixties to 471,000 (with 53% having less than 5 hectares) covering a surface of 5.3 million hectares in 1994 (distributed on 167 thousand in the north, 218 thousand in the centre and 86 thousand in the south). A fall of 30% of the average farm size which passed from 16 hectares to 11 hectares and a fall of 50% of the agricultural area per capita, taking into account the demographic trends, which are at 0.6 hectares per capita in 1994 against the double at the beginning of the sixties. Moreover, the farms are quite diversified. They differ by status (agri-complexes, production cooperatives lands improvement companies, and private farms), size and performance. This diversity indicates though the prevalence of private farms which are the majority and hold more than 90% of the arable lands. The agro-combinats, cooperatives and the improvement and development companies are rather minority and manage only 9% of these lands. The professional organization of the agricultural sector constitutes a fundamental option in the national development strategy for this sector. Five professional types of organization can be listed, each meeting specific aims and goals: Agricultural services co-operatives: of which there are 204 operative in various fields of the agricultural sector such as fishing (12), milk collection unities (100), fruits and vegetables (29), poultry (9). Main difficulties found by this type of organization are in the level of the management and the financing of their activities. Water use associations: in this category we count up 2,317 groupings which operate mainly in the field of drinking water (1494) and irrigation (753). These groupings make it possible to more than 167,000 families to provide drinking water and to 83,000 farmers to make use of water for irrigation for a surface about 99,000 ha. Central Co-operatives Structures: their number is 7 and they operate in strategic sectors such as cereals, seeds and other activities. Inter-Professional: there are 8 inter-professional groupings operating in ten sectors: vegetables, dates, citrus fruits and fruits, wine, milk, red meats, poultry products and fishing. These groupings play a significant role in the organization of agro-food system and market regulation. 9

10 Agricultural chambers: particular form of professional organizations, these three rooms (North, Center, and South) play an advisory role in the agricultural development on the level of regions. The deep transformations that agriculture knew during the last century, resulting into the internal and external shocks which it underwent, gave rise to agrarian systems with little interaction. Thus modern agricultural farming practices and integrated into the local and external market, coexist with existing systems of production remained, under the weight of their constraints of traditional structures in the field of the adopted techniques and little integration into the market. Developments in the adoption of technologies were observed during the last years. Thus as regards mechanization, the number of tractors was multiplied by three between 1960 and It passed from 10 thousand to 35 thousand tractors. According to FAO statistics', 5 kg of artificial fertilizers were used per hectare at the beginning of the sixties and 25 kg by the middle of the Nineties. Technological package introduction of the green revolution type can be regarded as the most significant technological innovation which took place in Tunisian agriculture during the last thirty years. Taking into account the fact that the possibilities of extension of cultivable lands are limited, this technology combined with the irrigation and the intensive use of artificial fertilizers, herbicides and farm equipment by various crops, are the main sources of agricultural growth in Tunisia. 3.2 Products Fruits occupy a significant place in the Tunisian agricultural production. Traditionally, the most cultivated species are those which are best adapted to the agro-climatic characteristics of the different areas of the country (olive-tree, citrus fruits, date palm, etc). Olive oil is a particular activity in Tunisia. Initially it used to be a traditional activity and an important source of income especially for the olive oil that is highly remunerated on the international export markets. Moreover, the strategic extent of this sector is a consequence of its social dimension. Since, the production of olive oil occupies nearly 100 thousand farmers, that is to say 30% of the whole of the farmer population. Moreover, nearly a million people draw part of their income from the Tunisian olive oil sector. (Table 3) The citrus farming represents on average 2.9% of the value of the total agricultural production (at constant prices). The citrus trees cover 25 thousands hectares in This area was only 19.4 thousand ha in The output oscillates between 10 and 15 tons per ha. The date s production amounted to 111,000 tons in 2003, including 69,000 tons of deglet nour, down 3.5% and 4.2% respectively, compared to the previous year, due to irregular weather conditions during pollination period. But in spite of the excessively high temperatures experienced in August and early September 2003, impeding the development of fruits, especially in areas with new plantations, the harvested dates were of higher quality, thanks to the efforts aimed at clearing plantations and protecting the groves from adverse weather conditions. 10

11 1200 Figure 2: Majors fresh fruits products Tons Source: MEDAGRI Olive Dates Oranges Apples Production of spring fruits increased in 2003, particularly for dry-shell almonds. Indeed, this harvest doubled, to 36,000 tons, enough to easily meet the domestic demand. Almond exports remained marginal, at just 144 tons for 2003, sold mainly on the French market, up from 75 tons a year earlier. For summer and autumn fruits (except pears and apples, which were down 11.8% and 1% respectively), harvests were high, thanks to initial production from new plantations and to favorable weather conditions. In particular, production of peaches was up by 12.2% to 92,000 tons and pomegranates by 6.3% to 67,000 tons. Thus domestic demand was easily satisfied, but there was only limited surplus to be exported. Apricot production in 2003 increased very slightly over the previous year s figures, coming in at 26,000 tons. The quality of the fruit improved, with early varieties predominating, which helped exports, up from 143 tons in 2002 to 180 tons in 2003, shipped mainly to France and the Gulf countries. Processing operations yielded 820 tons of canned goods (vs. 808 tons in 2002). The livestock sector represents an important agricultural activity in Tunisia and generates a significant additional income, in particular, for the small farmers and the owners without little or no land. Most of the breeding activities in Tunisia are practiced in an extensive way. Sheep production remains the dominant speculation and accounts for 75% of the total number of the units. (Table 4) The local breeds held by the small-scale farmers still have a significant ratio in the constitution of the livestock in Tunisia. The breeds resulting from improving genetic crosses are presents in a large number of farms but their generalization remains limited Figure 3: Livestock products 1000 Tons Cattle Meat Chicken and Turkey Meat Cow Milk, Whole, Fresh Hen Eggs Source: MEDAGRI

12 Vegetable crops constitute, generally, an activity of small-scale farming. The production of this sector exhibited a quite increase over the last decade (figure 4, table 5). This growth results primarily from the extension in the irrigated perimeters, development of greenhouse techniques and the use of new varieties. Over the period , the annual average growth of the production of vegetables in Tunisia in value terms was 5 %. The vegetable yields remain variable translating of great disparities on the levels of the quantities of water available for this type of real cultures and their need Figure 4: Majors vegetable products Tons Tomatoes Potatoes Chilies & Peppers, Gre Onions, Shallots and Green Onions, Dry Chick-Peas Source: MEDAGRI At constant prices, tomatoes contribute with 2.7% on average to the value of the total agricultural production. The cultivated areas of tomatoes represented 22.1 thousand hectares in The production has clearly increased. It passes from 530 thousand tons in 1990 to 810 thousand tons in 2002 (Table 5). This increase translates the growth of the outputs which have passed from 25.2 to tons per hectares. In 2003 the tomato harvest amounted to 992,000 tons, up 85,000 tons from 2002, as a consequence of favorable weather, a greater area of cultivated land (26,300 hectares, 18,600 in seasonal crops), and increased use of drip irrigation techniques. Production would have been even higher if temperatures had not risen so high in the summer, impacting negatively on both tomato quality and yields. Despite an increase in land planted in hot peppers, up from 16,900 hectares in 2002 to 18,200 hectares in 2003, the harvest decreased from 210,000 tons to 193,000 tons. This meant a drop in average yield from 12.4 tons to the hectare in 2002 to 10.6 tons per hectare in Land planted in potatoes in remained at virtually the same level as the year before: 22,300 hectares, yielding a harvest at practically an unchanged level of 310,000 tons. This drop in seasonal production (145,000 tons vs. 160,000 tons a year earlier) was offset by an increase in lateseason production (135,000 vs. 120,000 tons), while early-season production came in at an unchanged 30,000 tons. To make up for the production deficit during the slack period and to meet sustained domestic demand, imports amounted to 36,600 tons of potatoes in 2003, destined mainly for consumption, with a total value of 20.8 MTD, compared to 46,200 tons worth 25.6 MTD in Despite an 11.2% increase in land planted in melons and watermelons in 2003 (to 22,800 hectares), production fell by 2.7% to 365,000 tons. This was attributable to a 12.6% drop in yields, averaging just 16 tons per hectare. 12

13 Other market crops were also down from 2002 to 2003, mainly onions (-12% to 350,000 tons) and artichokes (-35% to 10,000 tons). Lower onion production resulted mainly from flooding in a number of regions. Insufficient supply pushed prices up as a consequence and created the need for 850 tons in imports. Industrial crops: After sugar beet production was discontinued in 2001 for its low profitability, industrial crops are now limited to tobacco, asparagus and cork. Tobacco was grown on 2,000 hectares in 2003 vs. 2,900 the year before, in line with the steady decrease that began some years ago. Raw tobacco production fell by almost 29% to 2,000 tons, 1,800 tons being smoking tobacco. Given that, the current level of production can no longer cover all the needs of processing factories, there will continue to be a need for imports. Purchases abroad of raw tobacco increased from 5,500 tons worth 21.2 MTD in 2002 to 7,000 tons worth 23.7 MTD in Asparagus grass flourished under the favorable weather conditions prevailing during campaign, especially abundant rainfall in the spring of 2003 that helped reconstitute the esparto layer. Thus 40,000 tons of green esparto were harvested, 14.3% more than the previous season. There was a large increase in the selling price of this material that supply processing factories, up from 65 to 80 TND per ton. Cork trees in the forests of northern Tunisia currently cover 80,000 hectares, 60,000 hectares of which are in a production phase. Exploitation of these resources is carried out according to the rotation required to reconstitute tree bark. Production amounted to 5,200 tons of cork in 2003 vs. 5,600 tons in Agricultural products in value (base 1000 for period) and major fruit and vegetable yields are presented in tables Intermediate inputs The use of fertilizers used in agriculture surface remains modest and remains somewhat constant during the last years (Tables 8, 9). This is explained by the progressive elimination of the subsidies and the consequent rise in prices induced by the agricultural reform. It is also explained by the frequent dryness observed during the last decade that limits the potential for fertilization. In Tunisia, the quantity of manure used accounts for only 30% of the recommended quantities. The use of pesticides and other chemical treatments against vegetable diseases and parasites remains largely limited to the export crops and cereals. That s why only statistics about cereals areas treated by this type of input are available. Cereals treated areas even in this case represent only 35% of total cereals areas which are by and large located in the north of Tunisia (Table 10) Machinery and equipment Agricultural mechanization is often a subject of controversy because it can replace human labor. This is undesirable in the countries where the employment potential out of the agricultural sector is limited. However, the agricultural intensification generally requires accurate operations at one specific times (sowing, fertilization, plant treatments, etc.) requiring the use of specific forms of mechanization. In addition, even if labor is overall abundant, the seasonal shortage often appears and the use of mechanization becomes necessary. The mechanical technology most adapted for a country will depends however on its economic conditions such as the ratio of cost the capital relative to land tenure systems (Boughanmi, 1993). The evolution of the number of total tractors and an index of the number of tractors per ha of cultivable land make it possible to appraise the growth of the level of intensification by mechanization in Tunisia, However, this level remains insufficient in comparison it with world standards. Total number of tractors in use ( ) and the evolution of cultivated areas per tractor are presented in tables 11 and

14 3.5 - Water uses Taking into account the limited water resources and the disparity between supply and demand often generated in conditions of dryness, Tunisia has engaged over the last three decades in a dynamic program of water mobilization. Several investment projects were granted reaching 9 % of the total investments of the state in the VIII plan of development ( ). Agriculture remains as the biggest water consuming sector (more than 80 % of the total demand) and accounts for approximately 18 % of the GDP. Irrigated agriculture represents 35% of the output value derived from the agricultural sector, 20 % of exports and 27 % of agricultural employment (Ministry of Agriculture and water resources 2003). Irrigated perimeters, contribute to 95 % of the vegetable production, 70 % of fruits and 30 % of the dairy output. The average efficiency of the irrigation networks is relatively weak. It is estimated approximately 50% (Bachta, 2004). The non-conventional water sources (reclaimed wastewater and desalinated water) represent only 5 % of the available resources. The national authority drainage (ONAS) collects 178 million m3 of used waters in the public network of draining of which 156 million m3 are treated in 61 purification stations. Sea waters are not exploited because their desalinations constitute an expensive option. The irrigated areas with those types of waters cover thousand ha. Tree crops are first with an area of thousand ha, which corresponds to 37% of the total surface. Market gardening is second with 30%. They are followed by forages (16%), cereals (16%), other industrial crops (1%) and vegetables. These irrigated crops represent only 10% of the cultivated lands but contribute nearly 40% to the value of the agricultural production. The industrial sector and the tourism retain 5% and 1% of water resources, respectively. The service of water-drinking represents 11% in rural area, the service rate reached 80 % in 2000, whereas it did not exceed 38% in 1990 (Table 13) Labor force and employment in agriculture The agricultural active population constitutes around 23% of total labor force in The number of capita per farm is nearly of 10.1, in However, a rate of 0.2 workers per hectare of cropland is anticipated in 2000 (Tables 15a, 15b). 3.7 Price and incomes Olive production cost is over 500 DT/Ton; this cost is very variables and correlated with the yield and climatic conditions. However, the production cost of olive oil is estimated at 3000 DT/Ton in the year The local price of olive oil is over 3.5 DT/liter. The price of a ton of citrus fruit, in the production period, varies between a minimum of 310TND in 1993 and a maximum of 439 TND in The price of a ton of tomatoes at production varies from a minimum of 103 TND in 1990 to a maximum of 166 TND in In 2002 the producer price of a ton of tomatoes is over 144 DT (Table 16). For potatoes, the producer price oscillated during the last decade between a minimum of 196 TND/ton in 1990 and a maximum of 270 TND/ton in The producer price per ton of dates has continually increased between 1990 and 1997 to reach 1560TND. Since 1998, a sharp fall was recorded bringing it back to only 1065TND in The producer price of sheep s meat has equally increased to reach 3600 TND/ton of carcass weight in 2001, whereas it was only 2087 TND/ton in

15 The producer price of beef has progressively increased to reach 2573 TND/ton in However, it was only 1640 TND/ton in Upstream and downstream sectors The changes observed in the Tunisian economy, industrialization, growth of the tertiary sector and tourism was accompanied by a relative reduction in the contribution of agricultural sector to the GDP. Thus the agricultural value added represents only 12 % in GDP. The food processing sector starts to acquire a significant place in the Tunisian economy and contribute with 2.67 % of GDP in This value has doubled to nearly 4.46% in 2002 (Table 17) Upstream sectors Agriculture has made a substantial progress in terms of market integration. Currently, agriculture buys around 800 million TDN (current price) to upstream sectors in 2002.This represents around 24.18% of total agricultural value added. Tunisian Imports fertilizers and pesticides and Tunisian trade in machinery are presented in tables Food processing sectors In 2001, the Tunisian total industrial sector accounted nearly 12 thousand companies. Around 5262 of them employ more than 10 permanent workers. The remainder is entered in accounts as family or craft companies. The number of entirely exporting companies reached 2292.The number of companies with foreign participation is 1654 of which more than the half has 100% foreign capital. Among them, 1370 companies are entirely exporting. The number of companies which choose the quality system which are certified as ISO-9002 is 340. The industrial activities are quite diversified. They deal with the agro-food, building material, ceramics and glass, mechanics and metallurgic, electricity, electronics and electric appliances, chemistry (except plastic), textile and clothing, the cork and furnishing wood, leather and shoes, pastes, paper and cartoon and the plastic. Industry of textile and clothing are the most developed. They occupy 41% of the total number of industrial companies in Tunisia. The agro-food industry is ranked second after the industry of textile and clothing with 15% of total companies. This industry includes cereals and their by-products, the oils and oily substances, refrigerating warehousing, fish, fruits and legumes, soft drinks, milk and by-products, meats and other activities. Production values and the value - added tax: The production value of agro-food industries reached 3539 million TND at constant price in 2001, while it was only 2226 million TND in The corresponding value-added was 593 and 386 million TND respectively. The contribution of the olive-oil in the production of agro-food industries was 11.2% in 1991 and only 5.6% in

16 12000 Figure 5: Value added of total industrial sector and food processing sector (constant price 1990) 12, TND ,50 11,00 10,50 % Total industrial sector Food processing sector Share of FPS/Total industry 10,00 Source: Ministry for the Development and the international cooperation FPS: Food Processing Sector Employment: The agro food industries provide around 79.5 thousand permanent jobs. Firms employing more than 10 persons represent nearly 79% of total companies. Only olive-growing industries contribute with 8.6% to permanent employment (Table 20). The European Union (EU) has always been the main commercial partner of Tunisia. Indeed, 82% of goods and services exports are destined to this market and 79% of imports come from the European countries. The other main commercial partners are the Maghreb countries (Algeria, Libya and Morocco), the Gulf states and the United States of America. In the olive oil sector, a number of industrial firms operate near 1545 oil mills, having a theoretical capacity of olive crushing of 27,769 tons per day, 10 factories of pomace oil with a theoretical capacity of 2 thousand tons per day, 11 units are involved in refining edible oils with a total capacity of 900 tons per day, 24 units of conditioning units equipped with a capacity of 15 thousand tons per day in addition to a number of soap, building and craft factories. For tomatoes, quantities processed showed a particular evolution during the two last decades. Indeed, they evolved from about 100 thousand tons in 1972 to near 610 thousand tons in However, quantities of tomatoes for transformation show significant fluctuations through the years. These quantities reached the thresholds of 280 thousand tons in 1993 and 320 thousand tons in In 2003, 620,000 tons of fresh tomatoes were delivered to canning factories, which processed 106,000 tons of concentrated tomato paste, compared to 560,000 and 98,000 tons respectively in These variations follow the fluctuations of the total fresh tomatoes production. Delivery prices of fresh tomatoes to processing industries are fixed by the government and completely independent with the production level of this commodity. The fluctuations in the production of fresh tomatoes also impact on the use ratio of the transformation units capacities. Indeed, the industrial sector of transformation currently counts 42 units of transformation where only 34 are functional. Moreover, in cases of weak productions the transformation capacity falls (50 to 65 %). During favorable agricultural seasons, the transformation capacity becomes insufficient in peak periods. These difficulties, in addition to fluctuation of the production and transformation, are accentuated by the geographical distribution of the capacities of transformation facilities and their corresponding capacities. 16

17 The floor price for tomatoes to be processed has been set at 0.095TD per kilogram for several years. With domestic consumption at some 80,000 tons, the surplus available for exports was 26,000 tons, 5,500 of which were actually exported for 8.4 MTD, compared to 25,800 tons which generated 37.6 MTD in Processing of fresh hot peppers in 2003 began at the end of August, involving 30,000 tons (vs. 34,000 tons in 2002), with a floor price for sale of peppers to canning factories ranging from 170 to 0.35TD per kilogram. This yielded about 15,000 tons of harissa vs. 17,000 the year before, of which 5,200 tons were exported vs. just 2,900 tons a year earlier. It is to be noted that 760 tons of harissa were carried over from the previous year. The cereals transformation intended for human consumption counts more than 2480 companies (including more than 2100 bakeries) which represent around 67% of the total number of the processed food companies (3656 units). They are two types of transformation: a first transformation using wheat as raw material and a second transformation of wheat triturated into finished products. 5- Food consumption The Tunisian pattern of food consumption is marked by the large share occupied by cereals. Indeed, cereals constitute a significant portion of the household food expenditure and still represent the common base of all urban and rural food modes. Average annual consumption of cereals and products per capita in Tunisia is one of highest in the world. It was estimated in 2000 at 205 kg/year by person (Table 21). The consumption per capita and per year of grain oil was of 20 kg including 4.6 kg (23%) of olive oil. The consumption of olive oil was quite fluctuating and varied between a minimum of 1.4 kg per capita in 2002 and a maximum of 8 kg per capita in The important share that the other seed-oils (Colza, Soy, Corn and the palm) in the total oil consumption is explained, in part, by the main gap between their prices at consumption level which is subsidized, and that of olive-oil. In spite of the climatic constraints and the fluctuations of the agricultural productions, Tunisia has been able to reach a certain progress on the level of the self-sufficiency rates of the requirements in basic commodities. Self-sufficiency in cereals remains one of the national priorities. However it should be specified that with the exception of some products (in particular, wheat, sugar and olive oil), Tunisia must face a food demand that is growing under the combined effect of the increase in population and the increase in consumption per capita for other products such meats and milk (Table 22). Several factors or elements can weigh down the task of Tunisia in its objective to ensure the food safety. The productivity of agriculture remains below the forecasts and objectives, besides, the agricultural sector is still under the pressure of several institutional and technical constraints. In addition, the seasonal and annual fluctuations of the agricultural productions in Tunisia are very significant and remain often related to the problems of availability of water and its management. According to the last national survey on the budget and the household consumption the share of the foodstuffs in the Tunisian household budget can go up to 35% for the year This value is in successive decrease but it remains always high compared to other countries of the north of the Mediterranean. Average consumption of basic food commodities varies from rural to urban areas. On a per capita basis, traditional products such as hard wheat and barley tend to be consumed more in rural areas. Other products with higher budget status are consumed more in urban areas (such as bread wheat, meat and milk). 17

18 Average consumption of other basic commodities, however, including oil, sugar and, to some extent, milk, varies little from one area of the country to another. Limited variation in eating and cooking habits is probably at the origin of such homogenous consumption patterns. 6 Trade in agri-food products 6.1- Structure of trade in agri-food products Export During the period , Tunisia exported 106 thousand tons of olive oil, 24 thousand tons of dates, 117 thousand tons of cereals and derivative, 78 thousand tons of flour, 15 thousand tons of wines and drinks, 15 thousand tons of tomato dough, 14 thousand tons of sea products, 4 thousand tons of potato and 3 thousand tons of tobacco. The value of food exportations increased from million TND in 1990 to 557 million TND in The olive-oil is the principal product of exportation with 42%. The date sector is ranked third at export level after olive oil and sea food products. On average, its contribution to agricultural exports was about 13 % in the last decade (Central Bank of Tunisia, 2003). During the last five years, total date production fluctuates around tons/year. Exports are about 35 thousands of tones. Date export represents 25% of the national production and the rest is sold on the local market (45%), or lost, self-consumed and transformed into feeds (30%). About 70 % of the domestic date production transit through collectors, consequently this allows them to play an original role in the market and price regulation (Central Bank, 2004). The wine grape harvest for was down by 6.7% compared to the previous season, to 35,000 tons. Processing yielded 240,000 hectoliters of wine vs. 271,000 in With a carry-over stock of about 255,000 hectoliters, 495,000 hectoliters of wine were available, with 117,000 hectoliters destined for export compared to 170,000 hectoliters traded in Fishing trade: as for commercialization, because of a sustained increase in domestic demand, especially as recovery in tourism took hold starting the summer of 2003, exports dropped by 15.4% in terms of volume, offset by a 7.5% increase in terms of value, to 14,800 tons worth MTD. This trend is in line with an increase in average prices for the export of crustacean and mollusks seafood. Imported fish, mostly frozen tuna for canning industries, amounted to 27,100 tons worth 44.3 MTD, vs. 16,000 tons and 23.4 MTD in 2002 (Central Bank, 2004). Import To satisfy the internal demand in basis food products, which the level of national production doesn't constantly cover the level of the consumption for an increasing population, Tunisia has recourse to the import. The main agro food products imported are wheat, corn, barley, seed oils, sugar, potato, tobacco, tea, coffee and milk. During the period , Tunisia imported 1166 thousand tons of wheat, 465 thousand tons of corn, 296 thousand tons of barley, 230 thousand tons of sugar, 39 thousand tons of potatoes, 7.5 thousand tons of tobacco, 10.8 thousand tons of tea, 8 thousand tons of coffee and 10.9 thousand tons of milk. The food importations value reached 1143 million TND in 2002 vs million TND in The food balance was generally showing a deficit. The rate of cover oscillated between a minimum of 49% in 2002 and a maximum of 55% in 1991 (Tables 24-25). With the considerable increase in production, imports of cereal were down significantly in 2003 to 19.5 million quintals worth MTD vs million quintals worth MTD the year before. This decrease was mainly for hard wheat (down from 801,800 to 472,400 tons) and barley (down from 825,300 to 75,100 tons). Purchases of cereal abroad were necessary to cover Tunisia s needs over the first half of Influenced notably by lower world supply, prices were up sharply: 10.8% for hard wheat to $202 per ton; 16.9% for soft wheat to $139 per ton; and 4.9% for barley to $113 per ton. 18

19 The quantity of fresh milk going to collection centers actually decreased by almost 10%, to 406,000 tons (43% of national production), compared to 450,000 tons and 47.7% in The ensuing 6.6% drop in industrial milk production to 312 million liters meant a higher level of imports, amounting to 29,100 tons of milk and by-products worth 41.8 MTD vs. 23,400 tons worth 34.7 MTD a year earlier. The ongoing imbalance between supply and demand that occurred most markedly toward the end of 2003 in relation to higher consumption during Ramadan meant that 20.5 million liters had to be taken from buffer stocks, along with import of 17 million liters of sterilized milk. Red meat production was up 3.5% to about 131,000 tons. This trend was facilitated by incentives to farmers to further promote this strategic product, notably greater recourse to fattening of calves and a more vigorous selection of productive races. But supply of the domestic market was not steady, due to the fact that farmers tend to keep their cattle when fodder is abundant, so prices shot up and a new round of red meat imports had to be engaged, after being discontinued in November The volume of imported meat rose to 1,400 tons worth 4.7 MTD, destined mainly for the tourism sector. Import growth in the period is positive for all classical products except Soya bean oil (- 5%). The most important import growth concern barley (35%), this can be due to the particular intention accorded to the breeding sector, but also because of dryness in the studied period ( ). Thus, a deceleration of fodder crops is balanced by an import growth of some other breeding foods. Contrary to imports, the export growth (in quantities) is decelerated for all majors exports products. The most decrease concern olive oil. This can be due to the yield fluctuation of this product according to climatic conditions. Figure 6: Structure of Trade in Agri-food products Million TND Food Exports Food Imports E - I (Million TND) (E/I)*100 Source: MEDAGRI 2003 E: Exports I: Imports 19