Pulse growers shouldn’t count on India to pull them out of a marketing quagmire, says one of Canada’s largest pulse exporters.
“Marketwise they’re really not there. They’re just not looking that hard,” said Rob Tisdale, special crops manager for Agricore United.
As the world’s biggest producer and consumer of pulses, India sets the tone for pea and chickpea markets and this year it sounds more like a hang-up than a ring.
According to the Canadian Grain Commission, pea exports to India amounted to 165,600 tonnes for the first quarter of 2004-05, a year in which growers harvested a record 3.3 million tonne crop.
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During the same period in 2000-01 exporters had already shipped 637,137 tonnes of Canada’s second biggest pea crop to India. In other words, sales were happening at nearly four times the current pace.
India is by far Canada’s most important buyer of pulses but this year Indian importers have been inactive despite a poor domestic harvest.
That is a big reason why Canadian farmers are facing poor pea prices.
“We’re not hopeful for any nearby price recovery in yellow peas, which sets the whole trend because they’re the lowest-priced, best-valued pulse for India,” said Tisdale.
He doesn’t expect prices to rebound until next spring.
India’s poor demand has forced traders to stop obtaining edible peas for the export market.
“What we’re doing corporate-wise is trying to get a push going more on the (domestic) feed side and at least move some volume,” said Tisdale.
The export logjam doesn’t make sense because India had a poor pulse harvest in 2004.
Production numbers are hard to come by and often suspect but according to the director general of the Indian Council of Agricultural Research, the kharif or summer crop harvested this fall, is about 10 percent lower than last year’s output, although there was no breakdown among crops.
One Canadian analyst thinks poor early season monsoon rains led to a much smaller grain crop than the Indian government is suggesting.
“I think they’re overstating what they have so far,” said Marlene Boersch, managing partner of Mercantile Consulting Venture, a Winnipeg agriculture-consulting firm.
Tisdale also puts little faith in India’s statistics. Even if those statistics were reliable, there is another big unknown supply and demand factor.
“Their whole warehousing system is so massive it’s almost impossible to pin down what’s in the pipeline. But all we know is they’re not aggressive buyers right now.”
Statistics published by India’s department of agriculture show farmers harvested a record 15.24 million tonnes of pulses in 2003-04, up 36 percent from the previous year’s output.
If that number is accurate it could explain why the drop in the 2004-05 kharif harvest is failing to trigger the logical surge in demand because warehouses are full.
On the bright side, India has extended a temporary reprieve on tough new fumigation rules to May 31, 2005, from Dec. 31, 2004.
That means Canadian exporters can continue to fumigate pea shipments with methyl bromide upon arrival in India.
