AGT head expects Indian pulse tariffs to stay in place

Murad Al-Katib argues the duties allow India to spend billions on ag support, and no government would eliminate them

Tariffs on pulses going into India will drop when the country’s domestic crop is poor but will most certainly remain in place, says Murad Al-Katib, chief executive officer of AGT Food and Ingredients.

He said the tariffs allow the Indian government to pour billions into domestic agricultural support and no government would eliminate them.

“Anyone here who is waiting for the (Canadian) government to solve this tariff issue, let’s just move on to the next thing,” Al-Katib told the Agricultural Producers Association of Saskatchewan. “It’s not going to get solved and it’s got nothing to do with us.”

But he recently travelled to India and said there are signs that reductions could be on the way.

Excessive rain that stuck around two extra months has affected planting intentions and food prices.

Onions are usually about $100 a tonne in India but are currently worth $800 a tonne. India accounts for 23 percent of world onion consumption.

Planting is three to four weeks late.

“We’re expecting wheat to be up; we’re expecting pulses to be down,” said Al-Katib. “We’re expecting that they’re going to start to import again.”

The government can lower the tariffs but leave the high rate in place, which allows it to increase them again when the domestic crop is better.

India, with a population of 1.3 billion people, has a net birth rate of about 38 million each year, he said. Water is scarce and he called the government’s plan to become self-sufficient in pulses a pipe dream.

Middle class incomes are rising so much that the country will require one million more tonnes of pulses each year.

“They’re not going to be able to feed themselves,” said Al-Katib.

He said Canadian exporters should hope for a resolution to non-tariff trade barriers such as the recently announced list of 30 weed seeds India is now worried about.

He added that Turkey was affected by drought this year and needs durum and lentils. Other markets need Canadian wheat to blend with poor quality wheat from other suppliers.

But he also said that Canada should continue to work to add value by shipping food rather than commodities.

“Where we want to go as an industry, I believe, is to feed $33 trillion in middle class spending in Asia by 2030,” he said, and there is opportunity for everyone.

The Canadian industry often sees the situation as a zero-sum game with winners and losers, he said, pointing to the Beyond Meat debate.

“We’re not stealing from each other. The market is growing faster than our ability to supply so we should up our game and find our spots.”

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