The pulse industry will have to compete harder to maintain grower interest after the Canadian Wheat Board loses its export monopoly, says an industry analyst.
Stat Publishing editor Brian Clancey said Australia is a good example of what happens when a wheat monopoly loses its powers.
Wheat acreage jumped in that country after the Australian Wheat Board lost its single desk authority in 1999.
Plantings averaged 32.3 million acres between 2005 and 2009, up 24 percent from the average of 26.1 million acres between 1995 and 1999.
Over the same period, land in pulses dropped to an average of 4.19 million acres from five million acres. Lupin and pea plantings fell while chickpea, fababean and lentil acreage rose.
Read Also
Saskatchewan agriculture sector receives federal funding
PrairiesCan funding will assist in the continued growth of Saskatchewan’s ag research and manufacturing sectors.
“It was only the bargain pulses that went down in area,” said Clancey.
He expects a similar thing will happen in Canada, with pea acres declining and lentil plantings rising in the face of stiffer competition from wheat, durum and barley.
However, it is possible that all pulses, including lentils, will suffer as they lose their status as one of Western Canada’s only cash crops.
Farmers will be able to get full value for former CWB crops right off the combine. They will also be able to price their spring wheat two years into the future, giving that crop a distinct advantage over peas and lentils.
World markets will need to pay more for Canadian pulses to keep them competitive with spring wheat, said Clancey.
Murad Al-Katib, president of Alliance Grain Traders Inc., a major processor of Canadian pulses, isn’t afraid of operating in the post-CWB monopoly environment.
“To say that the wheat board’s monopoly coming off would put the industry at risk is a ludicrous statement,” he said.
Growers plant pulses because they generate good returns, fix nitrogen in the soil and provide significant agronomic benefits in a rotation.
“That will continue,” said Al-Katib. He predicted that lentils and chickpeas will be two of the country’s top three profit performers for years to come.
Al-Katib said he believes pulse companies will have a leg up on cereal crop handlers in the post-monopoly world because they have a history of serving customers around the globe.
“The pulse industry will not only survive, it will thrive because we’re international companies and we have market connections in the world,” he said.
Al-Katib said he is looking forward to Alliance getting involved in the containerized movement of niche wheat crops.
“We’re very excited about the opportunity that might present itself.”
