Western Canadian green peas have been valued at $12 per bushel or higher for over a month now, but Shawn Madsen says he’s unsure if the strength seen in prices will continue into the winter.
“The trade generally thinks this is pretty expensive on green peas,” said Madsen, operations manager for Southland Pulse in Estevan, Sask., noting prices have been as high as $12.50/bu.
“Nobody is buying it, keeping it, and then trading it a little later. They are doing it really hand to mouth, because they don’t know if it’s (prices) going to be up or down. The overall sense is that it won’t be this high for that much longer.”
According to Prairie Ag Hotwire, FOB farm green peas are valued at $12/bu. as of Monday (Nov. 18), compared to $6.25 to $6.75 for their yellow counterparts.
That means the spread between the two varieties is quite high at this time of the year, Madsen said, adding that people think an empty pipeline could be the explanation for the spike in price of green peas post-harvest.
“The theories out there are that it was an empty pipeline,” he said. “People have told me they think some companies went short earlier on when the price was so high, and then as you saw prices dip, they kept on selling. Then the growers didn’t sell and in order to cover these sales, they had to pay up for it.”
Expectations that India could produce a record-large pulse crop haven’t hurt prices either. Despite being a major importer of the Canadian product, the effect has not yet been felt by growers, and Madsen said he’s not sure it will.
“You have news (India is expecting a bumper pulse crop) like that and we’re still paying $12.50 per bushel for green peas as of yesterday,” he said. “It seems like green peas are their own entity right now, because everything else seems to be affected except green peas.”
As for the yellow pea market, prices aren’t weak, but they are certainly not as strong as the green variety.
“There’s been mild demand, but there hasn’t been a lot that’s been happening,” he said, noting that prices have remained pretty flat. “You can do business as long as it’s at that ($6.25-$6.75) level — and it’s not a lot of business either.”
“If it wasn’t for green peas this year, we would have had a fairly slow fall. They kept us busy and yellows were just a little bit of a filler every once in a while.”
— Brandon Logan writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.