Analysts are skeptical about India’s first production estimate of the 2009 rabi pulse crop.
The projection calls for a 9.43 million tonne crop, up 13 percent over last year and one million tonnes above the 10-year average.
Desi chickpea production is forecast to rise 790,000 tonnes, which analysts say would delay importation of the 2009-10 yellow pea crop from Canada.
But according to Canadian pulse industry executives who just returned from India, the government numbers appear optimistic.
Gordon Bacon, chief executive officer of Pulse Canada, discussed the rabi crop with two of India’s large state trading companies during a January trade mission.
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The yield estimates for wheat and soybeans were neutral to bullish, but these were largely a sideshow when compared with corn.
“Their comment was it’s an average crop,” he said.
Another contact told him the government tends to exaggerate production estimates because it has been criticized for not having pulse yields, a staple food ingredient in India, keep pace with other crops.
“The government never wants to put a spook in the market in terms of shortages,” said Bacon.
Carl Potts, director of market development with Pulse Canada, returned from India Feb. 17, and spoke to state importing companies as well as members of the private trade.
“I heard on a couple of occasions that there is a bit of a failure in the crop,” he said.
Potts also heard reports from other sources that it’s an average crop.
The truth likely won’t emerge until the rabi crop is delivered into commercial channels starting in April.
If it is an average crop, production would increase by six percent based on the government’s own rabi acreage estimate. That is less than half of the increase forecast in last week’s first advance estimate number.
In an e-mail response to questions about the rabi crop, Chandra Shekhar, associate editor of the Hindu Business Line, described conditions as satisfactory.
He thinks it would be safe to assume a crop of between nine and 9.3 million tonnes.
That is up from the 8.5 million tonnes he was forecasting in January at Pulse Days but lower than the government’s recent estimate.
Given that general elections will be called in April or May, the Indian government will be anxious to contain pulse prices, so he expects the continuation of a strong import program and of the pulse export ban.
Potts agreed the government is unlikely to tinker with agricultural policy so close to an election.
“Everyone I talked to seemed to think that the export ban would be extended and remain in place,” he said.
However, he doubts the government will be as involved in pulse importing as it was in 2008, when it provided 15 percent subsidies to state trading companies to import 1.5 million tonnes of pulses.
“I got the feeling that the government has significant stocks available right now, especially when you’re talking about yellow peas, and likely wouldn’t be looking to import through the government agencies, at least for a while.”
