Last week, we shared that the local government of the Indian state Madhya Pradesh – one of the largest pulse growing areas down there – decided to interrupt its price support scheme for channa (chickpeas).
There is more to be said on that story this week. Indian sources report that the Indian government is not going to be purchasing any more chickpeas from farmers in the Madhya Pradesh province under the Minimum Support Price that was announced earlier in the year. Previously, the same Indian province had sought to buy at least 50% of the region’s production chana (chickpeas) saying, as prices are now about 25% below said MSP. Clearly, India is still scrambling to deal with the local pulse production glut. It continues to trigger further depression of prices for the things chickpeas.
On the weather front, Australia got timely rains that helped farmers down there to get their seeding done early. There are field reports that indicated that certain areas of Australia got up to 14mm of rain during the Easter weekend. Previously, summer rains with precipitations between 60mm and 120 mm during the first three months of the year, replenished the Australian subsoil moisture.
On another note, we find that the Indian pulse situation is dragging on the world pulse markets not only in the price direction but also in other ways. With the Indian situation going on, Canadian trade is reporting that the marketing environment for pulses has changed.The price discovery process is distorted. More specifically, the process is less transparent and is replaced with the word of the mouth approach. Farmers are more cautious to sell their pulses and are taking more of a wait-and-see approach.
Price wise, Saskatchewan desi chickpeas prices are pegged at roughly 23¢ CAD per pound, that is 4¢ CAD per pounds down on the week and from well below the 36¢ we saw at this time a year ago. Comparably, kabuli chickpeas are holding well at 33¢ CAD per pound, steady on the week but about half of the 63¢ CAD per pound at the same time last year.
To sum up, the Indian situation is dominating the pulse markets, including chickpea. From a Canadian perspective, a lot of this hinges on the weather as well as with chickpea acres.
In Saskatchewan, chickpeas acres are expected to expand, as a lot of chickpeas produced in Canada actually go to other countries, or stay within the Canadian borders. In contrast, in other major chickpea producer countries such as Australia where acres are expected to decline as we reported a month ago.
On the sales recommendation front, we are sold out on 2017/18 old crop as of more than a month ago, ahead of the price decline.
On the new-crop, if you’re not yet at 15% sold mark then you should continue to post new crop on the FarmLead Marketplace at 34¢ CAD per pound, Make sure to ask for an Act of God clause in the comments!
Have a great week!
Brennan, Garrett, and Adrian
April 8 – Chickpeas Weekly GrainCents Digest
April 6 – Are Desi Chickpeas Poised to Fall Further?
April 5 – Will Bill C-49 Be Enough to Fix Canada’s Rail Problems?
April 1 – Chickpeas Weekly GrainCents Digest
March 29 – USDA Says US Chickpeas Acreage Continues to Grow in 2018/19
March 26 – India’s Chickpeas Going Nowhere Because They’re Still Too Expensive