Exceptional bean crops in Canada, the United States and Mexico will keep prices depressed and drive down next year’s plantings, say analysts.
Ontario bean marketer John Thompson is forecasting a 40 percent decline in navy bean acreage and a 30 percent drop in blacks in 2003. Those are Canada’s second and third largest classes of beans respectively.
He thinks pinto plantings will not fall as drastically, predicting 780,000 seeded acres, down from 850,000 in 2002.
Huge crops in Ontario, Manitoba, Michigan, Minnesota and North Dakota are lowering prices and forcing some farmers out of bean production.
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“I’m very surprised by the yields that we have through the Red River Valley,” said Thompson, vice-president of W.G. Thompson & Son, a Blenheim, Ont., special crops firm.
The bean crop was shaping up to be another disaster in Ontario and Michigan, but late July showers changed that.
Agriculture Canada estimates this year’s production at 407,000 tonnes, up nearly 40 percent from the 2001-02 crop.
Manitoba Agriculture pulse specialist Bruce Brolley said the three main American bean producing states are also reporting record crops. The oversupply is leading to predictable results in bean markets.
“The prices that are out there right now are not real great, so not a lot of farmers are lining up to sell them,” said Brolley.
He agrees with Thompson’s assessment of next year’s plantings.
“For sure we’re going to see a decline in bean acres and probably the biggest decline will be in white (or navy) bean acres.”
Compounding the problem is a 1.2 million tonne Mexican bean crop. Harvest conditions were ideal there, resulting in a crop that the United States Department of Agriculture calls “the best seen in the past 15-20 years.”
But a recent USDA report on the Mexican bean industry also contained some good news for Canadian growers. Analysts believe that “waning soil vitality” combined with a decreased capacity to hold moisture puts the future of Mexican dry bean production in question.
“Inconsistent weather patterns and economic stress threaten to make it unprofitable in many states,” said the USDA.
That’s good news because Mexico is one of the world’s biggest consumers of blacks and pintos, two of the main classes of beans grown in Canada.
Other news out of Mexico has the government imposing a temporary ban on imports of dry edible beans from the U.S. due to the discovery of an unspecified pathogen in a recent shipment.
Brolley said a cynic would accuse Mexico of putting up artificial trade barriers because they have a good crop of beans and want to protect their growers from outside competition.
“They may be trying to do to the Americans what they do to everyone else,” he said.
Canadian exporters are also reporting problems. Two rail cars of Canadian beans have been tied up at the Mexican border for two weeks.
Mexico isn’t the only market growers should be watching. Thompson said there are also developments in Europe and the U.S.
China and Ethiopia have recently emerged as low-cost suppliers of product to the United Kingdom and Western Europe, two regions that consume a lot of navy and coloured beans.
Chinese product is selling at a discount of $50-$100 per tonne to North American beans in those markets, he said.
Growers should also keep an eye on what happens with soybean prices. If that market makes a comeback, many American growers may shift production out of dry beans and into soybeans, a crop that is covered under the new U.S. farm bill.
“If they decide to plant soybeans, it can change the dry bean scenario so quickly,” said Thompson.
