WINNIPEG — After years of western Canadian farmers rushing to lock in pulse crop contracts during the spring, that hasn’t been the case this year.
“Normally I would say that I’d have my plant booked to December and I don’t have a single thing booked this year,” said David Newman of Commodious Trading near Victoria, which has a processing facility in Weyburn, Sask.
“But does that mean we’re not going to sell anything? No, it just means it’s going to be done differently.”
The pulse market has slowed and prices have dropped following a North American winter in which India increased import tariffs on numerous pulse crops (lentils, peas, chickpeas). Traders haven’t sold as many or as big of pulse shipments, and it doesn’t look like things are going to change heading into spring planting.
At Commodious, Newman said, policies have changed in the office. In years past they would publicly market their prices, but they have now switched to word of mouth deals.
“Just taking the opportunities as they come up, make the best choices you can and go on to the next week, or next month and not really worrying about it,” Newman said.
This strategy is similar to farmer sentiment.
In previous years there would be a panic if contracts hadn’t already been signed for pulse crops, but farmers are now taking a more wait and see approach.
In Australia, farmers are taking a similar approach to handling the Indian tariffs. Traditionally India was a major importer of Australian chickpeas. In a March 21 story on Grain Central, industry professionals warned that farmers should change their marketing strategy.
The article by Henry Wells said Australian chickpea growers will now have to market their crop throughout the calendar year and beyond. Farmers should also be prepared to store pulses and sell on price spikes, the same as they do for cereal crops.
The logic is similar to what Newman sees happening in Canada, where there are no incentives for farmers to pre-book because prices are low. Buyers also aren’t looking to buy ahead of time because international markets aren’t clamouring to fill orders.
“People think there’s going to be product. People think there’s going to be demand, but it just hasn’t lined up like it has in years past,” he said.
Newman also doesn’t expect to see a huge change in prairie acres. Farmers he talks to are saying they can’t stray too far from their crop rotations or they’ll risk disease in their soil.
“(Farmers) can tweak a little, but it’s not like everyone’s just going to (make rash decisions and) now all of the sudden we have zero lentils and four million acres of soybeans or something,” he said.
The current pulse crop market is similar to when Newman first started in the industry in the early 2000s, when business was day to day and prices weren’t very high.
“(It’s) just kind of everyone running at cost,” he said.
“Everyone struggling to (get through the year and) figuring how to make it work.”