Analysts have mixed views on what impact extensive flooding will have on one of Canada’s top export markets.
Bangladesh has been deluged by monsoon rains in 2020.
A map produced by the United States National Aeronautics and Space Administration (NASA) shows more than one-quarter of the country was under water as of late July.
“Monsoon rains typically cause some level of flooding but officials said this flooding may be the worst in a decade and the longest-lasting since 1988,” NASA said in a news release.
The flooding has swamped almost one million homes and more than 1,500 sq. kilometres of farmland.
Bangladesh was Canada’s second largest market for lentils and peas and the third largest for wheat in 2019, according to Statistics Canada.
The country has been importing similar volumes of those three commodities through the first five months of 2020.
Brian Clancey, editor of Stat Publishing, said the country’s weather woes bode well for continued strong pulse imports from Canada.
The last time there was such severe monsoon flooding in Bangladesh back in 1996 it had a big impact on the country’s food supply and food storage.
“What we saw at that time was we saw a surge in imports of Canadian product that lasted for about two years,” he said.
It did not result in millions of tonnes of additional demand but perhaps a couple hundred thousand tonnes, which is significant for crops like peas and lentils.
“I don’t know if you’ll begin to feel it this calendar year or more next year,” said Clancey.
He noted that Bangladesh is a poor country that is extremely price sensitive, so Canadian exports will have to fit within the tight budgets of consumers in that country.
Bangladesh is not a big producer of pulses but it is a huge consumer of the commodity, although there have been reports that a portion of what the country imports is being smuggled across the border into India.
“It’s not all staying in the country,” said Clancey.
Bruce Burnett, analyst with MarketsFarm, said it is important to keep the excessive rainfall in perspective considering the region of the world where it is occurring.
“Yes, the flooding is pretty spectacular, but this is the middle of the monsoon,” he said.
Bangladesh receives 80 percent of its rainfall during the monsoon season between June and October, so farmers in that country are used to dealing with deluges, as is the case in India.
“When I was in India a number of years ago the point was made very forcefully that we know how to handle water, we’ve been doing it for centuries,” said Burnett.
He anticipates that the extreme flooding this year will create logistical problems but he does not anticipate that it will increase demand whatsoever.
If anything, it could have the opposite impact. Improving economic conditions have been the driving factor behind Bangladesh’s increased wheat imports.
Burnett worries that some of the companies that have been using the imported wheat to create a variety of products could have been impacted by the flooding.
Clancey noted that Bangladesh is not the only country in the region dealing with excessive monsoon rainfall. Nepal is in the same boat.
Rainfall has been normal across India but there are also pockets of the country dealing with excessive moisture. In addition, farmers will be battling a plague of locusts and logistical problems caused by COVID-19.
“They’ve got problems,” said Clancey.