CNS Canada — A lentil watcher says Canadian prices for the crop are surging higher right now, in response to frequent Prairie rains and international demand.
“It’s more than your usual slow rally, it (the market) spiked higher; especially the greens, which are shooting up right now,” said Chuck Penner of LeftField Commodity Research in Winnipeg.
“Lousy weather” in Saskatchewan is affecting quality and has caused a lot of the volatility, he noted.
Weather forecasts are calling for temperatures in the 20s C this weekend across much of Western Canada — but when it comes to lentils, Penner said the damage has already been done.
“We probably have overseas buyers panicking a little bit and trying to get their hands on any quality, green lentils that are out there,” he said.
According to Prairie Ag Hotwire for Friday, spot bids for No. 1 Laird lentils currently range between 27 and 33.5 cents a pound, roughly five cents higher than a month ago. No. 2s are fetching bids between 21 and 30 cents per pound. Bids on No. 1 Crimson lentils are 27 to 30 cents per pound. All of the bids are higher than a month ago.
Each year Canada ships its lentils to buyers in Spain, South America and the Middle East. However, the biggest buyer is usually India and this year, Penner said, the country is especially hungry for the pulse crop.
“Even before this (wet Prairie weather) Indian demand was going to drive the market higher. This just makes it more so.”
India is not growing many lentils right now, he explained; instead it’s using other crops that can be substituted for green lentils. The green varieties are especially important for exports as their entire body tends to be used.
“So visual appearance is very important,” he said.
Red lentils, on the other hand, often are hulled or split, leaving their physical appearance marred to begin with. However, the wet weather does leave open the potential for processing difficulties if they become wrinkled or stained, said Penner.
“I’m watching the weather and hoping farmers can get the crop off,” said Penner, adding most of the crop is in Saskatchewan.
According to this week’s Saskatchewan crop report, 61 per cent of the province’s lentils are estimated to fall within the bottom two quality grades due to disease and weather pressures.
The amount of crop that has been combined ranges from 21 per cent in the east-central region to 63 per cent in the southeast.
— Dave Sims writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.