MarketsFarm — Yellow and green pea prices in Western Canada have taken divergent paths to start 2021, with yellow peas on the rise and greens declining as values reach parity in many locations.
Mike Jubinville of MarketsFarm Pro explained that while Canada’s pea exports suffered under yellow pea import restrictions implemented by India, China later filled the void by bringing in more peas from Canada.
“Fortunate for us, especially in the last 18 to 24 months, China has emerged as a significant buyer of our peas… Approximately 70 per cent of our exports go there. China has now emerged as the 1,000-lb. gorilla of our pea market,” he said.
The price of green peas in Western Canada has taken a hit in recent months, trading at a range of $8.25-$9.50 per bushel on Monday according to Prairie Ag Hotwire data. At that time last year, the high delivered bid of green peas was at $11.15 per bushel.
Yellow peas, on the other hand, are seeing rising prices, trading from $8.50 to $9.75 on Monday, an increase of $2.60 per bushel from the year before. The change in prices has now erased the premium green peas had over their yellow counterparts.
China’s hog industry, Jubinville said, has been in a rebuilding stage after it was hit hard by African swine fever in 2018. As a result, there has been an increased demand for feed and Canada’s yellow peas, which can also be used as a protein or starch, are suitable for Chinese pork producers. Similar increases in prices have also been seen in feed corn and soybeans.
As for green peas, increased production in Canada has resulted in enough supply to properly satiate demand, lowering prices. Despite this, depending on the growing season, Jubinville predicts the demand for peas and other crops from all corners of the globe will drive prices upward.
“As we go into next year, it’s not just peas, it’s canola, it’s barley, it’s oats. Everything is trading at multi-year highs,” he said.
“So we have a competition for multiple acres going into the springtime and how growers want to shift their land-base usage around what crops they’re going to grow and how many acres they will dedicate to those crops. These are big economic decisions growers are starting to go through right now.”
— Adam Peleshaty reports for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.