Early signs point to a vast improvement in the quality of Saskatchewan lentils over last year’s wreck.
About three-quarters of the crop has been combined in the south, and processors say quality looks good.
“For the most part we’re calling it a No. 2 or better quality and the proportion of No. 1s is nice,” said Greg Simpson, president of Simpson Seeds Inc. in Moose Jaw, Sask.
Murad Al-Katib, president of Alliance Grain Traders, said three-quarters of the Saskatchewan lentil crop usually makes the top two grades. Last year only 20 percent was No. 1 or 2.
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“We’re back to a normal production scenario,” he said.
“We’re actually looking at a higher percentage in the top two grades than a normal crop, so quality looks really good.”
Statistics Canada is forecasting 1.6 million tonnes of lentils this year. Many industry observers feel that is too high, but it matches Simpson’s 1.65 million tonne forecast.
It would be smaller than last year’s 1.95 million tonne harvest but still well above the long-term average.
“We think it will be a sufficient supply,” said Simpson.
He expects strong early-season demand, especially for large green lentils.
“The world was short of good quality green lentils, so with this supply in place there will be good demand for this quality.”
Jeff Jackson, pulses market manager at Scoular Canada, advised growers in the latest issue ofSaskatchewan Pulse Growers’ Pulse Market Reportto hold onto their green lentils in hopes of rising prices. He thinks large greens could reach 36 cents per pound.
Growers in the United States planted 29 percent fewer lentil acres than last year and yields are expect-e d to be below average, which should lend price support to medium green lentils.
Simpson expects strong early-season demand for small green lentils from Greece, Italy, Spain, Morocco and Mexico, which have been holding off purchases in anticipation of better quality and lower priced product.
Al-Katib agreed that green lentil prospects are good with strong demand expected from the Middle East, North Africa and South America. India could also be in the market because of a 16 percent decline in pigeon pea plantings this summer.
The market outlook for red lentils is not as promising.
“There seems to be an oversupply of reds and demand is down,” said Simpson.
Stat Publishing editor Brian Clancey wrote in thePulse Market Reportthat Australia will have more than 150,000 tonnes of good quality old crop lentil carryout by the end of October and a conservative estimate of 330,000 tonnes of exportable product when the new crop is harvested. This will create a challenging year for red lentil markets, he said.
Al-Katib said red lentil demand will pick up in the cold weather period of September-February, which is the peak buying time for the commodity. He expects strong demand from India and Turkey.
The Turkish government recently released its estimate of 376,000 tonnes of production, which is well below earlier forecasts of 550,000 tonnes and the long-term average of 500,000 tonnes.
Al-Katib cautioned growers not be too quick to give up on red lentils.
“Let’s see how lentils are doing next March. We can’t make a conclusion in August,” he said.
Scoular said nobody is eager to buy red lentils. There is potential for prices to move into the mid-20 cents per lb. range in the early part of spring, but in general it will be a sluggish year for reds.
Simpson expects Canadian growers will be disciplined in their lentil marketing.
Farmers have traditionally used lentils to generate cash flow off the combine, but high wheat and canola prices should give them all the cash flow they need this year.
