Canada: China buys fewer peas

Pea imports are way down so far this year in one of Canada’s top markets.

China bought 657,000 tonnes of the crop during the first half of the calendar year, which was 22 per cent below the same time a year ago, according to a new report by the U.S. Department of Agriculture’s Foreign Agricultural Service (FAS).

“Industry contacts explained the reasons for this decline as excessive stockpiles (led by a massive increase in imports in 2023), exchange rate fluctuations, increase in sea transportation costs and trade policy uncertainties,” stated the report.

China imported 2.6 million tonnes of the pulse in 2023, a 64 per cent increase over 2022 levels. Many of those peas are still sitting in storage.

Canada supplied 60 per cent of those peas, followed by Russia’s 34 per cent. Australia and the United States accounted for most of the remainder.

India was the other main factor mentioned in the report. Its pulse imports are up 90 per cent year-on-year, which is restricting available supplies for other customers.

China’s pea industry was also the subject of a recent article published on the Global Pulse Confederation’s (GPC’s) website.

In that article, Zhang Baosheng, general manager of the Shandong Sunshine Vermicelli Co. Ltd., offered up another explanation for China’s slumping imports this year.

“The pea industry in China is facing significant challenges due to the anti-dumping investigations by the U.S.A. and Canada,” he told the GPC.

On June 28, the United States announced antidumping and countervailing duties ranging from 127 to 626 per cent on Chinese pea protein imports.

On July 22, 2024, the Canada Border Services Agency started applying provisional duties ranging from 1.1 to 54.6 per cent on pea protein from China.

Those duties are limiting China’s pea protein exports and reducing the need to import peas as a feedstock for the country’s pea fractionation industry.

“We hope for collaborative efforts to resolve these issues and foster better understanding and development of the Chinese and global pea industry,” said Zhang.

He also commented on how pea imports from various regions are being used in China.

Russian peas are used for feed and food purposes in China because they are cheaper, and the transportation logistics are easier.

“However, the Chinese pea (fractionation) industry still prefers Canadian peas for protein production due to their better quality and reputation,” Zhang told GPC.

China is attempting to find new markets at home and in other Asian countries for its pea protein, although he acknowledged that plant-based diets and meat alternatives are not yet major trends in China, which was why the product was exported to North America.

That bit of information is at odds with the findings of the FAS report, which stated that there is a growing market in China for pea-based dairy alternatives because more than 80 per cent of Chinese people are lactose intolerant.

“Plant-based protein drinks, such as pea milk or oat milk, are becoming increasingly popular,” stated the FAS.

“Industry experts agree that pea-based dairy alternatives have significant growth potential.”

The rapid growth of China’s pet market is also increasing demand for the pulse crop.

“Peas serve as a valuable source of protein in pet foods, with their allergen-free nature augmenting their suitability for a wide range of applications in functional foods,” stated the report.

As well, new research shows that pea protein can be used as a substitute for soy protein in hog feed with no significant differences in growth rates and illness rates.

“The feed with pea protein was less expensive, thereby improving the economic efficiency of the pig farms,” stated the FAS.

However, the plant-based alternative market has cooled off in China after a period of rapid growth between 2019 and 2022.

“Many start-up companies have disappeared or shifted their focus from plant-based meat to other products,” stated the FAS.

Investment has retreated as problems surfaced with the products, such as too many additives, high prices compared to red meat and texture issues.

Many consumers were willing to try a plant-based alternative product, but many did not make additional purchases due to the problems listed above.

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Tags: Canada, India, crop, imports, pulse, markets, pea, Australia, Russia, China, United States