PULSE MARKET UPDATE - MARCH/APRIL 2020

MARKET VALUES FOR PULSES CONTINUE TO REMAIN STRONG …

Roger Vickers, Chief Executive of PGRO, comments on pulse crops ...

Market values for pulses continue to remain strong. Whilst internationally the values appear to have peaked, locally sterling values have held well and look to be stable. This is at least in part thanks to the significant fall in the value of our currency in the dash for dollars as the stock market fell.

In competition terms, this currency flexing has also affected the major pulse producers in Australia and Canada as their valuations have also fallen.

With much of the old crop traded, and with stock committed to cargos or already despatched, there is apparently little left on farm to collect.

The trade of human consumption beans to Egypt has seen a drop off in interest, partly as good quality Australian crop became available, and partly as there is an anticipation of a significantly increased local production this year. The weather in Egypt has been good for bean production and there are hopes of much-improved local availability from May onwards.

With all the uncertainty around the economies of the world at present, there must be doubts about the forward markets and the ability to move produce when required. Destination buyers are sitting back at present unless they have immediate needs to fill.

The new crop season is ahead, but with the delayed spring start, and much of the crop going into less than idea soil conditions there are real uncertainties about the yield potential, let alone a lack of firm knowledge about crop areas. Early Bird suggestions of a 27% increase in pulse area have been challenged by questions about seed availability, wet soils potentially changing grower decisions, relaxation of the three-crop rule, and unrealised intentions for winter sowings. A recent survey of 5,000 farmers suggests perhaps a 45-50,000 ha increase in spring pulse area … but a total pulse area increase of 15% may be more realistic.

Despite all of this, the returns being realised on peas and beans from the 2019 crop have been tremendous and with all of the other agronomic environmental benefits they bring, there is an understandable interest in production. Demand has been excellent and it seems the market size for peas and beans continues to grow.

Early suggestions are that the Baltic crop area may fall slightly in 2020 as winter cereal crops are believed to have increased.

Australian new crop is set to expand with seed sold out and the prospect of good conditions with recent rainfall. Yet so much relies on the growing season ahead.

Lewis Cottey, President of Pulses UK, reports on UK pulse markets …

Feed Beans ...
Feed bean values have probably peaked, stabilising at around £240/t ex farm. They look set to stay at these levels for the near future. The market domestically has been restricted at these prices but with alternative protein meal sources (rape, palm and soya) firming a little, there may be some buyers showing renewed interest.
Imported peas are currently offering little price benefit but there is flexibility in supply and ready availability – reliability of supply is a perennial problem for buyers of beans.

Export commitments remain to be delivered but there are few new shipping opportunities as supply dries up.

Interest in the new crop is now being expressed with opportunities to sell at around £200/t ex. With confidence gathering as the spring crops are sown, forward sales are being made ex farm.

Human Consumption beans ...
Buyers for UK beans are now few and far between. Containerised shipments of high quality grains can still be sold, but availability is very limited, and the premium has almost completely been eroded with values in Egypt having fallen by around US$ 100 /t.

The poor quality and lack of availability of the 2018 crop has changed this market. Buyers have become used to dealing with damaged grains normally considered of feed quality and have become buyers of almost any quality at a price. Preliminary offers for human consumption new crop offer the prospect of a £20-£30/t premium over feed.

Combining peas …
New crop pea crop size looks uncertain especially for large blue / green peas. Seed availability has been reduced by poor germinating seed lots, and whilst contracts remain available, lack of seed availability may prevent this being realised. Marrowfat pea seed is plentiful, but contracts are less available with off contract producers risking the variability of smaller market and free market sales values. Peas failing to make premiums and directed to the feed market may fetch around £230/t ex farm

Marrowfat peas
Off contract sales values have suddenly found demand with a dramatic upturn in demand for canning. Open market values of up to £340/t ex for good colour and cooking parcels. 2020 crop contract values with a min / max £300-320/t ex farm may be offered.

Blue Peas
With good UK and EU demand, the very best quality in terms of colour and cooking ability will receive the top values. Reduced availability means the price range is now up to £310/t ex farm. Imported crops from USA and Canada are now looking expensive in comparison. Samples of micronising quality may fetch £300/t ex. Bleached grain samples will be discounted by £30-40/t. 2020 crop contract values are offered min / max £225 - 275/t ex farm.

Yellow Peas
Little has changed. The limited UK market with values being paid around £230-240t ex farm. Total demand remains low at present. 2020 crop contract values are min / max £200-250/t ex farm.

Maple peas
There is no real interest in this niche at this time and little availability either. Nominal values are suggested around £305/t ex farm. The market prefers the variety Rose.

The next Pulse Market Update will be April/May 2020