One of Canada’s foremost pulse crop analysts doesn’t have much of a bone to pick with the first official seeding estimate of the 2009-10 crop year.
Agriculture Canada forecasts static overall pulse plantings, with a 288,500 acre decline in peas largely offset by a 193,830 acre increase in lentils and a 70,035 acre jump in chickpeas.
The only big discrepancy between Brian Clancey’s outlook and the federal government’s is he expects a 2.04 million acre lentil crop, while Agriculture Canada forecasts 1.8 million.
If the editor of the Stat Publishing newsletter is correct, farmers would seed 27 percent, or 429,000 acres, more lentils than they did in 2008.
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“Two million acres isn’t unprecedented. It’s the second largest in Canadian history,” said Clancey. “The size of the increase isn’t unprecedented either.”
Clancey estimates 60 to 70 percent of the 2008-09 red lentil supply had been shipped out by the end of October, reducing supplies.
Although prices have dropped of late, the potential return per acre is higher than usual compared to wheat or durum.
“I don’t think farmers are going to worry about new-crop bids being low,” said Clancey.
The only limiting factor may be the availability and cost of seed but he is confident there will be enough for growers to plant two million acres, with most of the increase going into reds.
Clancey and Agriculture Canada forecast eight and seven percent declines in pea acres respectively, due to what is expected to be a 900,000 to 975,000 tonne carryout of the crop.
“Farmers are not likely to grow what’s in their bins,” said Clancey.
Adding to the dilemma is the “tremendous uncertainty” over Indian demand because of a seven percent increase in rabi season pulse plantings and what looks to be a good crop in the ground in that important destination for yellow peas.
“That really, really hurts import demand for the first half of 2009. We’re already seeing a slowdown,” he said.
If growers plant the anticipated 3.7 million acres of peas, the industry will probably be forced to market some of the crop as livestock feed.
“That means prices have to come down to levels that compete effectively and directly with corn and byproducts from the production of ethanol,” said Clancey.
Another factor is India’s newly announced minimum support prices. While subsidy levels have risen for lentils and chickpeas in local terms, they are down $23 and $28 US per tonne respectively from a global perspective due to the weakness in India’s currency.
“That means that we have to be cheaper. It’s as simple as that,” he said.
Agriculture Canada forecasts 210,035 acres of chickpeas, up 60 percent from last year. Clancey has it pegged at 203,000 acres. Either way he doesn’t feel it will be an oppressive supply of the crop. There is a good chance stocks will tighten further in 2009-10.
