As 2007 draws to a close, pulse crop prognosticators are making their first predictions for what 2008 holds and it looks like acreage will rise.
Analysts say the combination of attractive prices and rising fertilizer costs should entice more farmers to seed the nitrogen-fixing plants come spring.
Brian Clancey, editor of the Stat Publishing special crops newsletter, forecasts 3.93 million acres of peas in 2008, up from 3.63 million acres last year.
“Some market participants are looking for a larger increase, perhaps to 4.3 million acres,” he said in a recent article.
Read Also
Global pulse consumption to grow
Global per capita pulse consumption is expected to rise 23 per cent by 2034.
Merv Berscheid, a broker with CGF Brokerage & Consulting, is one of those predicting a larger increase.
“I think we’re going to see four million acres plus,” he said during a one-day marketing seminar put on by his firm.
Greg Kostal, analyst with Kostal Ag Consulting, told seminar participants there’s no reason to forecast a slowdown in pulse demand.
India’s agricultural production has not kept up with the food demand brought on by that country’s economic boom despite more government money available for better seed, irrigation and fertilizer.
“That is going to take time,” Kostal said.
As a short-term measure to deal with the supply shortfall, the country has eliminated the import tariff on pulses to March 2009 and has provided subsidies to buy pulses on the world market.
“They are really trying to fend off food inflation that has been racing higher at six to eight percent,” he said.
There is an urgency to increase production of all crops in India but the government seems to be particularly worried about wheat. It has increased its base support for the crop, raising expectations that wheat acreage will rise at the expense of pulses.
Kostal told growers to keep a watchful eye on what is happening with India’s plantings because it will be critical for establishing price direction in the coming year, with February moisture being an important measure of the crop’s success.
In the meantime, pea prices remain strong. Yellow peas have been substituting for chickpeas, which are in short supply globally. Prices in India have almost doubled over the last year.
“I think this market can hold $7 (per bushel) next year based on demand,” said Kostal.
He believes green peas will hit $10 to $11 per bu. some time over the next three months, along with an accompanying increase in new-crop prices.
“New-crop at $7.50 is still not enough to get the (required) acreage. It needs $8, $8.50,” he said.
Berscheid thinks lentils will top two million acres next year, up from 1.3 million acres in 2007. Red lentils are penciling out as the most profitable crop for Saskatchewan’s dark brown soil zone in 2008. Large greens are the fourth most profitable.
Price prospects for both crops look good considering the strong sales program to date in the 2007-08 marketing campaign.
“If we keep on the pace we’re shipping right now, we’re going to be bare,” said Berscheid.
Clancey isn’t quite as bullish in his lentil seeding estimate, forecasting 1.68 million acres of the crop in 2008.
He predicts 450,000 acres of chickpeas, up from 430,000 acres in 2007.
Berscheid is not so sure about that one.
He said “gross amounts” of Frontier chickpeas went in the ground last year and with all the lentil marketing activity, the chickpea crop hasn’t been moving.
Demand could pick up in the January-February period but it may be too late.
“If farmers still have Frontiers in their bin, they’re not going to seed them. Lentils would be a better option,” said Berscheid.
