Analysis on Pakistan Pulses Market
By Faisal Anis Majeed Bombi’s Group
Pakistan is the second largest importer of pulses in the Asian region. India being the market leader usually dominates market demand and prices trends.
Food imports in the previous fiscal year stood at USD 6.13 Billion, including $1.9 Billion spend on Edible oil and $ 2.05 billion on other food Items. Pulses imports surged to 1.23 million tons costing USD 952.25 million in 2016-17 compared to 898,615 tons in 2015-16 according to Pakistan Bureau of Statistics.
Major pulse imported this year was Desi Chickpeas mainly from Australia and some quantities from Ethiopia and Burma. From October 2016 till October 2017 about 17,390 FCL of Desi Chickpeas arrived Karachi ports, which equals to about 420,000 tons.
In the beginning of the season in Australia it was estimated that about 800,000 tons to 1.2 million tons of crop would be harvested; so, there was a buying pressure from India and Pakistan. In Pakistan due to dry weather and not enough rain, Desi chickpeas crop was expected to be low on yields.
Earlier this year during May a delegation from Pakistan went to Australia under the leadership of Austrade and met key suppliers from Australia. All delegates were inquisitive about the size of the actual crop which was still a question for Australian suppliers.
Many suppliers were also surprised to see the estimates earlier and later Australian statistics were revised due to higher yields. In May estimates were at 1.4 – 1.6 million tons of Desi Chickpeas. By the end of the season, experts were estimating that 2.2 – 2.3 million tons was the actual crop.
With the world, Pakistan also estimated that later on the crop will be less in Australia and they might see good increase in market later on when the stocks will be low; but it was like endless supply of Desi Chickpeas. India, Pakistan and all destinations were flooded with Desi Chickpeas; still, Australia had a good closing stock.
Pakistan’s local production of Desi Chickpeas was estimated to be about 225,000 – 250,000 tons and we imported about 420,000 tons which totals to about 670,000 tons. Normally, as an average we estimate Pakistan consumes about 750,000 tons; but due to high rates we can see some substitution with Yellow peas and Yellow peas dal.
With such high volumes, Pakistan would be most reliable partner for Australia in which almost no defaults were witnessed, Buyers overimported cargo and suffered huge losses on their speculation. Even when some buyers couldn’t pay their documents, indenters played their role and facilitated suppliers in the best possible manner. Still sufficient stocks of Desi Chickpeas are observed in Pakistan to sustain till our new crop is harvest.
During this period, Kabuli Chickpea was high in demand; the only commodity on the Pulses Chart which was active and kept buyer’s /importer’s spirit alive. Kabuli Chickpeas was received from various origins including USA, Canada, India, Russia, Sudan, Argentina and others. Buyers who invested in Kabulis were able to offset the losses incurred in Desi Chickpeas.
Red Lentils had a slow year as well. Canadian lentils crop was affected by weather and the cargo received in Karachi was with higher percentage of wrinkles which had lower recovery for Dal mills and didn’t have that usual good look of Canadian product which buyers were used to. A lot of cargo was imported and our local market is still not supporting. Stocks are high in Pakistan. Pakistani buyers are not showing much interest in new crop bookings for lentils.
Looking at this huge import of pulses, Plant Protection Department of Pakistan also played a vital role during this year by revising their import policy and keeping a keen eye on the type of products being imported. There were several discussions with Department of Plant Protection Pakistan and Karachi Wholesales Grocers Association (KWGA), leaded by Mr Anis Majeed and various prominent importers and indenters to give the importers’ perspective. Negotiations were successful and old import policy was allowed to continue till November 2017. Currently new policies are under discussion. Plant Protection Department is also in discussion with origin Countries’ plant protection department.