Canada’s fears of escalating French pulse production were well founded.
French farmers have planted 50 percent more pulses than they did last year, including a 60 percent hike in yellow pea plantings, a crop that will compete with Canadian exports in key Asian markets.
The startling increase in pulse acres is due to a new French subsidy that encourages farmers to grow protein crops in favour of cereal grains and oilseeds.
Carl Potts, director of market dev-elopment with Pulse Canada, said the combination of the new protein crop subsidy and the simultaneous loss of coupled support in France for cereal and oilseed crops has created a relative incentive of $81 per acre for growing pulses.
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When news of the shifting subsidy regime broke in November, Canadian pulse industry officials feared it would cause a dramatic increase in pulse acres.
Potts said that appears to be the case, according to numbers he has received from UNIP, a French pulse industry association.
French farmers planted 450,000 acres of peas and 291,000 acres of faba beans this year, up from 279,000 and 217,000 acres respectively in 2009.
“Our issue with this is artificial incentives by government that mask market signals and increase the incentive to produce one crop over another are distorting to production levels,” said Potts.
Pulse Canada has made its concerns known to the federal government. It is also encouraging negotiators to raise the issue of agricultural subsidies in free trade agreement discussions going on between Canada and the European Union.
France is a net exporter of pulses so the extra yellow pea production will compete with Canadian product in markets like India and south Asia.
Agriculture Canada is forecasting a record carryout of Canadian peas in 2010-11, so any reduction in export sales is unwelcome.
The subsidy will be in place through 2012.
