The kabuli carryout could be large next year, partially because the United States has moved from big buyer to big grower
REGINA — Canada’s kabuli chickpea growers can expect to be storing product in their bins for a while, according to a market analyst.
Marlene Boersch, managing partner of Mercantile Consulting Venture, is forecasting 328,393 tonnes of production, which is nearly triple the previous year’s output.
“That’s a very, very significant change in fortunes,” she told delegates attending the 2018 Pulse and Special Crops Convention.
The good news is carryout from 2017 is nearly non-existent and total supply will be 351,780 tonnes, but that is still double last year’s volume.
“The big question for the coming year is how big will the exports be,” said Boersch.
She is forecasting 145,000 tonnes, which is up modestly from the 120,000 tonnes expected in 2017-18.
Some in the trade think it will be more like 180,000 tonnes, but she isn’t convinced because Canada’s top chickpea market hasn’t been very active of late.
The United States purchased 23,309 tonnes of Canadian chickpeas between August 2017 and May 2018, which is down nearly 13,000 tonnes, or 35 percent, from the same period a year ago.
That’s because U.S. farmers are increasing acres to meet the burgeoning hummus market in that country.
Total chickpea supply in the U.S. is expected to surpass 500,000 tonnes for the first time, up from 365,688 tonnes the previous year. That will result in 107,815 tonnes of carryout.
“They have done very well in containing ending stocks up until now,” said Boersch.
U.S. growers are harvesting so many chickpeas that the country is becoming a major exporter.
It is forecast to ship 220,000 tonnes of kabulis to many of the same destinations where Canadian chickpeas are sold such as Spain, Pakistan and Turkey.
Canada is also expected to have a burdensome carryout of chickpeas. Boersch is forecasting 125,180 tonnes and a stocks-to-use ratio of 55 percent.
Jay Paskaruk, a trader with AGT Food and Ingredients, expects average yields for the 2018 crop and about 350,000 tonnes of Canadian production, which is slightly larger than Boersch’s estimate.
He said the U.S. crop is also in good shape, which should result in 425,000 to 450,000 tonnes of production, which again is larger than Boersch’s estimate.
The good news is that Mexico’s crop is expected to be smaller.
Paskaruk said there are more and more large calibre kabulis being produced in North America, which is what many buyers desire.
The quality of this year’s crop is still to be determined.
He said the market price for kabuli chickpeas will be approaching grower’s cost of production if it drops a few more cents.
“It’s not like it was last year where it’s the number one money maker and guys are partying when they sign their chickpea contracts,” he said.
Ali Siddiqui, business development manager with ACA Alliance, agreed with Boersch’s expectation for a bloated carryout.
“We are moving towards an oversupply situation however you look at it around the world,” he said.
Siddiqui is particularly bearish for small calibre chickpeas. There is only about two months of stocks for large calibre product.