Canada: Healthy pea sales on pace but India actions uncertain

Canada’s pea exports are off to a torrid start in 2024-25.

Bulk shipments were 1.12 million tonnes through week 14 of the crop year, up from 720,000 tonnes at the same time one year ago, according to the Canadian Grain Commission.

The total does not include container shipments, which account for 30 to 40 percent of sales, Chuck Penner, analyst with LeftField Commodity Research, said in a recent article he wrote for Alberta Pulse Growers.

Detailed sales information is only available for the first two months of the crop year. It shows India was the biggest buyer, purchasing 387,100 tonnes of the pulse, followed by China at 222,400 tonnes.

Penner said the pace of exports is well above the five-year average and will need to slow down later in the year.

“Keep in mind, there’s a lot of uncertainty in the rest of 2024-25, particularly in the third and fourth quarters,” he said.

“This includes the potential return of Indian tariffs on yellow peas, as well as India’s rabi (winter) chickpea, pea and lentil crop output, which will start showing up in February and beyond.”

MarketsFarm analyst Bruce Burnett is pleased with the early export numbers. “It’s good news that we’re off to a good start here,” he said.

But he noted that pea exports usually start strong and then taper off in the second half of the year. He agrees with Penner that India’s import policy will have a big impact on the pea market.

India had a good southwest monsoon this year. Seasonal cumulative rainfall for the June 1 through Sept. 30 period was eight percent above the 50-year average, according to the India Meteorological Department.

That could influence whether India renews its exemption on yellow pea import duties, which is set to expire Dec. 31.

“At the moment, there is no reason to believe India will extend duty-free imports of yellow peas beyond the current December 31 deadline for on-board bills of lading,” Stat Publishing said in a recent article.

“If farmers expand land in chickpeas and other rabi season pulses to match government expectations, there will be no political impetus to extend the duty-free yellow pea imports deadline to March 31. However, if it becomes clear plantings will decline, there is a modest chance yellow pea imports will be extended.”

Burnett said it appears unlikely the exemption will be extended, which would effectively shut down exports to that market starting in the new calendar year.

That means China would drive the pea market and Canada is facing increased competition there. Russia recently displaced Canada as the top supplier to that market.

Analysts estimate Russian farmers harvested 3.5 to 3.7 million tonnes of peas this year, so it will likely remain the top exporter to China.

But Burnett is more concerned about another factor in that market. Soybean meal futures prices have fallen about US$50 per tonne in the last month or two. That will likely put a ceiling on pea prices because it competes with soybean meal in China’s protein markets.

There is also some worrying news in India for Canada’s green lentil growers. The government’s first advance estimate of its kharif (summer) pulse production is 6.95 million tonnes, the smallest output since 2015-16.

That includes 3.5 million tonnes of pigeon pea production, which would be a disappointing harvest.

That would be good news for Canada’s pulse growers because green lentils can be used as a substitute for pigeon peas. However, AgPulse Analytica thinks the government is underestimating pigeon pea production in states like Uttar Pradesh and Odisha.

“At AgPulse, our yield model has put a final production figure of 4.3 million tonnes for this season,” the analyst said in an article published on the Global Pulse Confederation’s website.

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Tags: Canada, India, chickpea, shipments, lentil, output, yellow peas, pea, China, exports, import duties