Reports from India indicate chickpea acreage and production will fall steeply this year, but that doesn’t necessarily mean improved desi chickpea price prospects in Canada, says a special crops trader.
India’s agriculture ministry reports a 4.9 percent decline in pulse plantings compared to 2007, including a four percent decline in chickpeas, which are by far the largest pulse crop grown in the country.
Cold weather and frost in Rajasthan, which is home to about one-quarter of India’s chickpea crop, has government forecasters projecting an 8.8 percent, or 800,000 tonne, drop in winter pulse production.
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Indian traders and the Indian Institute of Pulses Research have forecast more dramatic production losses, saying winter chickpea output could be down 10 to 20 percent, or 630,000 tonnes, to 1.26 million tonnes.
That dismal outlook comes on the heels of a year in which India did everything in its power to encourage pulse imports to boost slumping supplies in an effort to keep food price inflation in check.
When the world’s largest producer and consumer of desi chickpeas is short of supply and looking at the prospect of another poor harvest, that would normally mean upward pressure on Canadian chickpea prices, but Martin Chidwick, a trader with Bissma Pacific Inc., said market dynamics have changed.
“We can’t necessarily make a correlation between the shortfall in (Indian) chickpeas and chickpea (prices) over here because there has been such a good job done with our yellow peas,” he said.
Indian housewives are substituting yellow peas for chickpeas in traditional recipes such as chana dahl, even on the rare occasions when yellow peas sell at a premium to chickpeas.
Chidwick has conducted a “totally unscientific” survey of a few Indian importers, who tell him yellow peas require less oil than chickpeas when preparing traditional dishes, which might partly explain the recent substitution trend, along with the fact that yellow peas are usually the cheapest pulse on the market.
Whatever the case, he said the Canadian pulse industry has done a fabulous job of encouraging substitution, perhaps to the detriment of the domestic chickpea industry.
So when he hears rumours in trade circles that India will be one to two million tonnes short of pulses this year, he doesn’t expect it to prompt more chickpea plantings in Canada.
In its first seeding estimate of the year, Agriculture Canada is forecasting a 30 percent decline in chickpeas to 301,340 acres. Chidwick has spoken to fellow traders who think the drop will be closer to 50 percent.
“When you stack up against everything else, the current values are really lousy,” he said.
It will be difficult for the crop to compete with yellow peas, which generated bids as high as $9 per bushel for new crop last week and $10.50 per bu. for old crop.
“It’s just not happening for us at the moment on chickpeas,” Chidwick said.
That goes for large kabuli chickpeas as well, in which India has suddenly emerged as a major exporter, depressing prices internationally.
“They’ve become a real force to contend with,” he said.
