Pulse trade has flat-lined with Canada’s biggest customer due to onerous new import restrictions.
The Indian Plant Quarantine Order 2003, implemented on Jan. 1, 2004, introduced phytosanitary requirements for the import of several grains including peas, chickpeas and lentils.
The new rules have effectively kept Canadian pulses out of India.
“Basically there has been nil exports out of Canada since January,” said Eric Fossay, senior pea merchant with Agricore United.
That’s a worrisome prospect because India is by far Canada’s most important pulse customer, accounting for nearly $100 million worth of exports in 2003, according to Statistics Canada.
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Many in the trade are speculating that the quarantine legislation is simply a non-tariff barrier erected to promote domestic consumption of one of India’s best pulse harvests in the past 10 years, said Fossay.
Most of India’s pulses are grown in the Rabi season. Those crops are planted in the fall and are harvested now.
According to the Government of India’s Press Information Bureau, the area sown to Rabi pulses was up 31 percent from normal this year.
Fossay, who just returned from a two-week fact-finding mission to India, disputes those numbers.
“The locals were telling me that the pulse acres were more or less stagnant.”
However, production is way up due to better weather. One of the main winter pulse crops grown in India is desi chickpeas, which have yielded between two and three million tonnes the past couple of years. This year’s crop is expected to be 5.5 million tonnes.
“The crop is in very good condition,” said Fossay.
And the Indian government appears to be taking steps to protect that crop from having to compete with imported product.
In addition to having to test for three pests that have never been a problem in Western Canada, exporters are being forced to fumigate all shipments of grain, which is the most burdensome of the new requirements.
“To fumigate grain you have to have it above a certain temperature and we’re shipping grain from the Prairies at temperatures of Ð10 C and Ð20 C.”
That means having to put the grain in a heated warehouse before sending it to India, which adds costs and delays to the export process.
Officials from Pulse Canada and the Canadian Food Inspection Agency are meeting with Indian officials next week to convince them to allow the CFIA to certify whether Canadian cargoes are free of the pests, eliminating the need for fumigation.
“Even the Indians acknowledge that none of these pests have ever been found in a Canadian shipment,” said Pulse Canada chief executive officer Gordon Bacon.
In the meantime, Canadian producers are fortunate the crop representing three-quarters of total pulse exports to India has found other homes. Fossay said many peas are being sold into feed markets in Spain and northern Europe.
“The edible markets became less important this year than they had been in previous years.”
He thinks India may come back into play in June or July once consumers have eaten their way through a good chunk of the domestic production.
“I really don’t expect much demand to resurface before then.”
It is also doubtful that the quarantine issue will be resolved until after pulse demand picks up.
But what might be of more concern to Canadian pulse growers than the resolution of the quarantine issue is India’s long-term plans for pulse production.
Kicking off the Kharif or summer crop campaign, India’s agriculture secretary emphasized last week that the government has prepared an action plan to divert some area under wheat and rice cultivation to pulses and oilseeds.
Fossay said there is an election coming up in May so this could be interpreted as “more politicking than commitment” but admitted the words “action plan” seem to refute that assumption.
Common sense shows that yields and prices certainly do not encourage Indian farmers to grow pulses when compared to other lower-cost producers like France or Canada.
“But government policy can sometimes change that very quickly,” warned Fossay.
