A country that has gained a reputation as a cutthroat competitor in bean markets is sharpening the blade in preparation for another slaughter.
China is poised for an eight percent increase in pulse production in 2005, according to the United States Department of Agriculture’s Foreign Agricultural Service.
If growing conditions are normal, the country will harvest 5.8 million tonnes of pulses, three-quarters of which will be beans.
That is bad news for Canadian growers, processors and exporters, said Dave Klassen, sales manager for Global Grain Canada Ltd.
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“In this last three years China has been slashing the prices on great northerns, undercutting American (prices) big time,” he said.
“We can’t even be remotely competitive.”
Chinese bean exports have been growing at a dizzying pace, placing their kidney beans in head-to-head competition with Canadian great northerns in Latin America, the Middle East, Africa and Europe.
And as the world’s lowest cost producer of beans it is winning many of those battles in price-sensitive markets, forcing companies like Global Grain to sell off supplies at discount prices that are leading to huge losses.
This week the Winkler, Man., exporter hopes to market a stockpile of great northerns it has been sitting on for nearly three years because it sees a small window of opportunity.
“China is not quite as aggressive right now because they are at the tail end of their crop,” said Klassen.
“Hopefully we’ll be able to squeak under the wire before they come out with a new crop again.”
Last year, China produced 1.8 million tonnes of broad beans, 1.1 million tonnes of mung beans, 600,000 tonnes of kidney beans and 350,000 tonnes of adzuki beans.
While most of the production is consumed domestically, Chinese exporters are on pace to export nearly one million tonnes of those beans this year.
During the first six months of the 2004-05 marketing campaign, a period which spanned from October, 2004 to March, 2005, China shipped out 361,494 tonnes of kidney beans, 67,284 tonnes of mung beans, 30,761 tonnes of adzukis and 17,013 tonnes of broad beans.
That has generated $419 million US in sales to countries like Japan, South Africa, South Korea, Cuba and Italy.
And it looks like more supply is on its way.
The USDA predicts Chinese farmers will seed 8.9 million acres of pulses in 2005, a nine percent increase over 2004 but pretty much on par with what was planted in 2003.
“The forecast rise in kidney bean production is the main factor behind the increase in pulse production in 2005,” stated the June 1 report.
Local prices for kidney beans rose 20 percent in 2004, making it a popular cropping choice for China’s farmers despite government incentives to grow alternative crops like corn, wheat, rice and soybeans.
