Market Update/
Canada New Crop Sowing

Current conditions:

The ground is having excess Moisture. Weather conditions shows there are more storm warnings and imperfect weather conditions for seeding of New Crop. Basis last year acreage, reports state farmers intend to increase acreage for kabuli chickpeas due to the current prevailing prices for Indian kabuli chickpeas. There are however concerns of not enough seeds are available basis the acreage raise.

Green Peas: The intention is that farmers have planned to plant 25 pct lesser from last year. There is not much incentive for the farmers in terms of realisation as compared to yellow peas which has more liquidity and less quality issues Green Lentils: More prone to quality issues than Red lentils.

Green lentils are sensitive to adverse weather and hence they need a completely fine weather to have a good quality crop. Hence there are no quality predictions as of now.

With market demand in India, particularly in South, there is no much support for green lentils considering competitive levels for Pigeon Peas.

Future tender by TNCS is expected to include all type of lentils and pigeon peas and there is a strong possibility for Red Lentils to contend with Green Lentils in the tender.

Red Lentils consumption is on the rise but last year crop-carry is a concern of quality. Last few years due to unseasonal rain during harvest Canada is losing out to Australia in terms of quality.

Wrinkles are the main issue and there is still a gap in understanding the cgc specs and there are interpretations by the Seller and Buyer paving the way for quality disputes and market also not supporting the buyers.

Prices are volatile compared to last season and this season started at USD 800 per ton and currently ranging around USD 550 pmt delivered.

Yellow peas: Forward brisk sales reported as compared to last year with the only danger on the fumigation issue. Current relaxation for fumigation is only up to 30th June 2017 latest date for bills of lading.

In the past for goods shipped from Canada in bulk vessels for public-sector undertakings these were fumigated in Singapore and was witnessed by CFIA and phytosanitary certificates as Indian PQ requirements were issued.

However for container shipments this would not be feasible or cost effective.

Indian Crops

Channa: Initial estimate by Ministry of Agriculture was 9 million tonnes which would be reduced due to shortage reported mainly in Madhya Pradesh areas followed by Maharastra.

Rajasthan crop at the moment estimate remain unchanged. The current arrivals mostly from Madhya Pradesh is going to stock due to the current uptrend in the market and shortage in growing areas.

Prices may remain range bound between Rs 55,000-Rs 60,000 per tonne. It is being observed there is a tendency to spike once it touches Rs 55000 pmt for the last two months. Currently it is traded nearly Rs 900 pmt more than the minimum support price.

Madhya Pradesh arrivals in February as compared to last year are down by 30 pct and Maharashtra as compared to last year is down by 9 pct. Rajasthan crop estimate is around 1.4 million tonnes and government entity is buying at market price in this region. Major exporter Australia has not yet started seeding of Chickpeas and hence estimate not known at this point of time. As farmers have got better realisation basis last year for nearly USD 200 pmt, intentions would be to either plant same or more acreage.

This year exporters experienced logistics issue in terms of availability of empty containers for shipment.

Green Mung Beans: Australia reported a big loss in harvest due to weather and this year crop is estimated to be about 30,000 mt as compared to last year of 125,000 mt.

Toor Whole: Maharashtra areas this season due to good weather conditions had reported double yield per acre and estimated to be about 1.1million tonnes. This is the main reason for the bearish sentiments for Myanmar and African origins at this point of time.

Millers reportedly prefer local crop which is easier to mill than African origins. Current government stock would be at 850,000 mt. Farmers have lost nearly 50 pct in terms of revenue per quintal as last year high was around Rs 10,000 per quintal as against current Rs 4,050 per quintal which is trading less than current Minimum support price. There is a good chance for toor whole to pick up from August onwards till the new crop arrivals. Point to note is that toor whole prices internationally follow the local prices prevailing in India.

Urad: Crop in South India has failed expectations which was evident from January onwards causing price increase for Myanmar origin which is the Only exporter. This has to remain firm as kharif crop is not available till October 2017.

Summary:
Exporters and importers are confused at this point of time on the MBR fumigation relaxation which is granted up to 30th June 2017 as cut-off date for Bills of Lading. New crop sales are volumes are less as compared to last year. The duty levied on pigeon pea had nil effect as Myanmar and Africa would provide the necessary certificate of origin document which qualifies for nil duty. Australian origin pulses and lentils stand a better chance due to compliance of methyl bromide regulations and consistency in quality.