Shifts to soybeans Canada remains the ‘giant bear’ among pea exporting countries, says analyst
Ukrainian farmers are getting out of peas in a big way.
Production has fallen more than 40 percent over the last decade, according to a report by the U.S. Department of Agriculture’s Foreign Agricultural Service.
Ukrainian farmers are expected to produce 267,000 tonnes of peas this year, similar to the previous year’s output. To put that in perspective, Canadian growers harvested 3.5 million tonnes this year.
“Unfortunately, the selling price for peas is not as attractive this season, so the majority of this crop will likely be consumed domestically,” said the USDA report.
The plummeting production comes as no surprise to Marlene Boersch, managing partner of Mercantile Consulting Venture.
She prepared a report in 2012 assessing the Black Sea threat to Canada’s pulse industry.
“I didn’t anticipate the Ukraine being the most aggressive competitor on peas in the future, and that seems to be bearing out,” said Boersch.
Ukraine was once a “formidable competitor” in pea markets, but the pulse crop is losing ground to corn, wheat and soybeans.
“In a lot of the Ukraine you can grow winter crops, and what that means is you have higher yields,” she said.
“I don’t foresee the Ukraine having huge pea acres (going) forward.”
The USDA said peas are mainly grown for the feed sector in Ukraine, but livestock and poultry production contracted by 200 percent between 1990 and the 2000s. The rate of decline has slowed in the last decade.
The crop also faces stiff competition in feed rations from another crop.
“Peas as a feed ingredient are gradually being phased out and substituted by soybeans in Ukraine’s animal feed industry,” the report said.
“Soybeans are produced in quantities to satisfy domestic and export demand.”
India is the leading buyer of Ukrainian peas, followed by the United Kingdom and the Netherlands.
Stat Publishing editor Brian Clancey isn’t surprised by the slowdown in Ukrainian pea production and exports because it’s hard to compete with Canada, the “giant bear” of the pea industry.
“You’ve got someone out there who is just overwhelming the world with their supply,” he said.
As well, demand for Ukrainian peas has been lacklustre in nearby markets.
“The European demand for peas is not brilliant,” said Clancey.
Ukrainian farmers aren’t the only ones getting out of pea production. French farmers have abandoned the crop because of a lack of government subsidies.
“They won’t grow it without a subsidy because they get help with everything else,” he said.
Russia is the only Black Sea country where pea production is rising, but it still doesn’t pose a serious threat to Canada, said Clancey.
“The U.S. will be a factor, but their prices are high,” he added.