Tepid price prospects for cereals, peas and even canola have some farmers seeing red.
Red lentils, that is.
Lentils may be a popular option in farmers’ seeding plans this year, particularly the red types.
Last year’s lentil crop moved quickly and attracted strong prices, especially compared to peas, said Jim Rempel of Saskatchewan Wheat Pool’s special crops division.
“They’ve actually given a good return to producers,” said Rempel, who said talk in the trade is for a 10 to 25 percent increase in acres.
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Recently new crop canola prices have fallen and that could lead Saskatchewan producers to look at other options, said Flo Beaudette of Roy Legumex Inc.
“If it (canola) doesn’t resurrect, that could change the optics of some growers back to peas or lentils,” he said.
Red lentils have been trading for 22 cents per pound recently, said Beaudette.
But those are “far over-priced” for new export business, said Rempel. He has seen recent red prices up to 26 cents per lb., but it would be hard to find an export buyer with offers of even 16 cents now.
Other considerations
Rempel said prices are reflecting factors other than regular supply and demand.
Some red lentil buyers have been caught short, and forced to buy on the spot market, he explained. Meanwhile, many growers have been keeping their red lentils for seed.
Canada has long been the world’s largest green lentil exporter. Red lentils are a relatively new venture.
In 1998, red lentils accounted for up to one-third of the lentil crop.
Rempel said Canada has a good marketing opportunity with red lentils because harvest here falls at the right time.
India and Turkey, two major red lentil producers, are usually close to sold out in October and November.
The Australian crop doesn’t come off until late December. And last year, it bombed.
Over the next month India, a major world producer and consumer of lentils, will harvest its winter crop, which is rumored to be large.
Turkey and Syria, traditional red lentil exporters, might also have large crops, said Rempel.
Beaudette said green lentils have been moving steadily. The richlea lentil business has picked up slightly as some customers, such as Mexico, substitute them for the slightly more expensive lairds.
Beaudette said richlea have been trading around 16 cents per lb., and lairds around 17 cents.
But the price of high-quality eston lentils has run up to 26 cents per lb. because they are in short supply, said Beaudette.
There’s an “abnormal spread” between the top grade and No. 2 estons, trading at 19 cents per lb, he said.
Until early December, estons were trading at 15 to 17 cents per lb.
“The growers did a good job on hanging back,” Rempel said, adding demand from customers like North Africa also pushed prices higher.
