The world’s biggest producer and consumer of pulses is expected to place a lot of calls to sellers this fall.
A report from the United States embassy in New Delhi predicts India will require two million tonnes of pulse imports in 2003-04, the second highest total in the country’s history.
That bodes well for Canadian pulse producers because Canada was India’s biggest supplier of peas and chickpeas and its second largest source for lentils in 2001-02, India’s biggest year for imports.
“We’re in a good position to have a good sales (program) into India,” said Stat Publishing market analyst Brian Clancey.
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The reason the Asian country will be looking for so much product is that a slight increase in its seeded acreage of pulse crops will be more than offset by slumping production this year, according to the U.S. embassy report.
But Clancey points out the document was written before a recent upgrade in growing conditions. The India Meteorological Department expects summer monsoons will deliver 98 percent of their normal load, up from an earlier forecast of 96 percent.
That two percent improvement sounds insignificant but represents a big turnaround.
“The situation in India looks like it has completely changed now,” said Clancey.
It might mean that imports will be shy of the U.S. embassy’s projections.
“But they could still very well be at two million tonnes if the world price is low, which is where we’re going, especially with peas,” said the analyst.
Not long ago, India was only importing 200,000-700,000 tonnes of pulses a year. But in 2001-02, purchases exploded to 2.3 million tonnes from 352,000 the previous year.
It’s no coincidence the surge in imports coincided with Canada’s emergence as one of the world’s biggest pulse exporters, said Clancey.
As Canadian farmers produced more peas, the price of food peas fell to feed pea levels and Indian buyers “bought a ton of the stuff” for its price-sensitive consumers.
With this year’s pea crop expected to yield 2.4 million tonnes, Canadian traders will once again be looking for large volume markets and India is a logical choice.
But a substantial part of the crop will also go to European feed markets, said Clancey.
“India can take a pile of peas, but at a certain point there may be even more than they can take.”
Clancey said Canada doesn’t have to worry about competition in Asian markets from the United States, even though U.S. growers seeded 18 percent more peas and 11 percent more lentils than last year.
That’s because a “huge amount” of America’s production goes into government food aid shipments, which fetch far better prices.
