CNS Canada –– Weather issues in India have generated some rumblings in the international chickpea market recently, but prices remain subdued in Western Canada and aren’t expected to see any significant strength in the near term.
“The chickpea market is still being dominated by very cheap Russian and Argentine supplies,” said Colin Young of Midwest Investments at Moose Jaw, Sask.
There were ample “warehouse stocks” in the Middle East and Mediterranean that had moved earlier from Russia to be reprocessed, he said.
“The (chickpea) market has been depressed for a long time and a price increase would be logical, but the markets are unpredictable,” he said, adding a significant increase was unlikely over the next two months
“Growers who are holding (chickpeas) hoping for a price increase, need to be willing to hold well into next fall,” he said, noting chickpeas can slip from an oversupply to an undersupply situation very quickly.
Weather problems in India have cut into planted area there, but the actual effect on the global supply/demand balance has yet to be seen, said Young.
Western Canadian cash bids have moved up slightly in recent months, although any strength largely corresponded with the weakening Canadian dollar, said Young.
While chickpea prices remain at the low end of historical averages, there is still routine business taking place. “In the depressed market we are seeing demand… chickpeas are moving, and they’re moving out of Canada regularly,” said Young.
From a pricing standpoint, he said the higher-calibre Kabuli varieties were seeing sizeable premiums over the smaller varieties.
“There is a significant spread between what the market will pay for an eight (millimetre) or under, or a nine and over,” said Young. Orion varieties of good quality are trading at over 27 cents per pound, but a lower-calibre Frontier will struggle to see 20 cents.
Lentils are seeing very high prices, which will likely limit the interest in planting chickpeas this spring. Young noted lentils represent less risk and lower costs for a grower, which should lead to a smaller Canadian chickpea crop in 2015.
Agriculture and Agri-Food Canada now forecasts chickpea plantings in 2015 at about 148,000 acres, down from 180,000 planted the previous year. Canada grew 131,000 tonnes of chickpeas in 2014-15.
— Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.