VANCOUVER – Jim Moen was feeling good earlier this month after sitting through a series of market outlook presentations for special crops.
The speakers reaffirmed what the grower from Cabri, Sask., already suspected – good demand is forecast for the coming year and supplies will be tight.
“That’s encouraging for most pulse crops,” said Moen, who is also chair of Saskatchewan Pulse Growers.
“Prices should be fairly buoyant. There should be some upside.”
Most of the information came from a presentation by Stat Publishing editor Brian Clancey, who told delegates attending the Canadian Special Crops Association’s convention in Vancouver that generally the good times should keep rolling in the new crop year that begins Aug. 1.
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The industry is putting the final touches on a year in which green lentils, chickpeas, canaryseed and mustard traded above their long-term averages, while field peas, desi chickpeas and red lentils set record high export levels.
India was largely responsible for this year’s marketing success, buying about 900,000 tonnes of Canadian peas, a third consecutive record volume. Demand from that region appears unlikely to fall.
“Chatter among some exporters suggests we could set another record for field pea exports to India in 2007-08 as importers there take advantage of duty-free pulse imports until at least March of 2009,” Clancey said.
That will take a big chunk out of the 2.97 million tonnes of anticipated pea production.
However, there is also bad news. Clancey doubts that Spain will buy feed peas this year, and that demand will be missed.
A wild card in the markets is Australia. Its crop was decimated by drought last year, but conditions so far this year are better, Clancey said.
When all the supply and demand factors are taken into account, he expects a doubling in Canadian pea ending stocks to 200,000 tonnes next summer, but that is still at a level he considers to be basically sold out.
Lentil stocks are expected to be half that amount, down from 475,000 tonnes at the end of this crop year.
Even if yields matched record levels, there wouldn’t be enough lentils on hand to sustain what Clancey estimates will be 750,000 tonnes of export demand.
He anticipates 234,000 tonnes of sales to the Middle East and Africa and 168,000 tonnes of red lentils to the Indian subcontinent, a region that a few years ago bought only 28,000 tonnes of Canadian product.
“I am looking for lentil stocks to continue to tighten over the coming season and I would expect markets to ration demand as we advance through the coming season.”
Demand from the Indian subcontinent should also gobble up much of Canada’s chickpea production, despite more than a doubling in Canadian plantings and in Australia’s estimated output. Residual stocks will rise slightly to 34,000 tonnes from 10,000 this summer.
With dry edible bean acres falling in Canada and the United States, North America is forecast to have less than 100,000 tonnes of bean supply remaining by next summer.
“In other words, stocks will remain tight and markets should remain relatively firm in 2007-08,” Clancey said.
Despite a 102,000 acre increase in mustard plantings, there will not be enough crop to match anticipated demand, even if yields are at their recent highs, suggesting stocks of that crop will also continue to tighten in the coming season.
The one exception to the low-supply theme is canaryseed, a crop that expanded by 110,000 acres this spring. Clancey said canaryseed supply will exceed demand, a problem that will be exacerbated if there is a good harvest.
However, much of this year’s carryover and new crop production will be in the hands of experienced growers who know how to drive up prices by holding out. It’s a matter of who blinks first.
On the supply side, growers attending the CSCA convention said their fields look good if not excellent.
“I’ve talked to a lot of people through different groups that I work with and everybody is pretty excited,” said Germain Dauk, a grower from Naicam, Sask.
Crops in Dauk’s region in soggy northeastern Saskatchewan had not even bloomed as of early last week. But that is the exception to the rule.
Much of the rest of the province looks fantastic, said Moen, adding that with a good crop and good price prospects growers should be able to make decent money in 2007-08.
“We’re encouraging producers to know their costs and sell for a profit,” he said.
“Don’t sell for a loss.”
