Nov 03-21: Pulse Notes

Normally at this calendar point, there is a lot going on in our pulse world.  Not so much this year.  Little is changing but neither are core expectations as described in recent research.  Users got immediate fill late summer and have a handful of reasons to lay low.  Logistics are fueling necessary rationing.  Red lentils have other headwinds like uncertain India policy (stock limits and import tariff), and another import choice, which is Australia that everybody on this planet knows about.  Domestic, including pet food, generally provides bulk of immediate interest.

Anticipated end demand result is this.  Exporters, resellers, brokers and users have reasons to keep positions small.  Trading demand is subdued, yet consumptive demand rolls along.  Instead of more conventional sugar-rush all-or-none moments, anticipatory trading demand is contained.  This instead means a shallower less volatile but elongated trading demand period, that may only convey spunk later winter.  Every pulse has a different tweak and positional starting point.  This has been researched.  Drop me an email for more information.

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July 26-21 India Lowers Lentil Import Tariffs

India government just lowered the lentil import tariff by 10% and lower the Agriculture Infrastructure Development (CESS) by 10%.   A net 20+2% import tariff reduction.    Effective date looks to be July 27, with no mention of an expiry date either in writing or from parliamentary video feed.  An expiry date would be preferred but means little right now because all know that amendments can occur at anytime. Given India stock limits and risk of policy amendments at a whims notice, trading demand is unlikely to carry same anticipatory behavior as before.  Further, volume and fluidity is impaired because container logistics are a mess.  Yet this policy announcement underscores a core fundamental piece to big picture view…..India is pulse deficit.  Smaller to mediocre crop size in Canada should harmonize with India being a greater import threat to sustain upward price risk.  Maybe a little sooner now in context of front loading trading demand.

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    April 24-21: Understanding Cycles with Red Lentils

    Four basic market scenarios that define core lentil price cycles.  This concept is applicable to many commodities in our Ag space, it’s just that lentils are cleaner to understand because of their uniqueness and limited substitution traits.  It has to do with directional change with regard to importer and exporter inventory.  Please call or send me an email and I’ll share the detail.

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    India Chana Harvest – Important to our pulse space Feb 27-21

    India government released its Second Advance Production Estimates this week for a number of crops.  Chana production, equivalent to desi chickpea type, whose harvest has just begun and will be in full swing last half March, was pegged at 11.6 MMT versus 11.1 MMT last year if believe the government, and 9.5-10.0 MMT if believe the trade.  A number of industry participants believe this year’s chana crop is closer to 9.5-10.0 MMT.  Difference would have significant market implications that apply to all classes of chickpeas, lentils and possibly field peas.  It’s must have knowledge and implications if a Canadian pulse grower.  Shoot me an email and I can shed insight.

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