PARIS/RABAT - Morocco will offer subsidies to import up to 2 million metric tons of soft wheat between Oct. 1 and Dec. 31, state grains agency ONICL said, as the North African country pursues a large import programme to offset drought-hit local production.

The October-December import scheme was approved by Morocco's finance and agriculture ministries, with subsidy details to be published separately, ONICL said in a note on its website.

After drought reduced its domestic crop for a second year, Morocco launched an initial import programme for the 2023/24 season targeting 2.5 million tons for July-September.

The move to extend the import campaign was expected after the Moroccan milling industry had estimated the country's import needs at around 5 million tons this season.

The continuation of the import subsidies may also be due to a shortfall in July-September inflows compared with the 2.5 million ton objective, a European trader said.

The European Union has been the main supplier for Morocco so far this season, with 1.2 million tons of soft wheat shipped by mid-September, according to EU data.

Moroccan millers have also reported the shipment of around 100,000 tons of Russian wheat. Traders had anticipated Russia might gain more market share in Morocco after the country adjusted its import scheme to help Black Sea origins.

However, it was still unclear what volume Morocco would import for July-September, with subsidies awarded for cargoes that are loaded before the end of the period, even if they arrive later, traders said.

(Reporting by Gus Trompiz and Ahmed Eljechtimi, Editing by Louise Heavens)