"As growers gear up and anticipate the drilling of 2016’s spring crops, trading of the old crop continues apace, ” comments Roger Vickers, Chief Executive of PGRO. "In recent weeks the value of UK pulse crops have taken a turn upwards, as the market bottomed out and recent trade has removed some of the remaining stock from the market place."
Looking at Domestic Markets, Chris Collings, President of BEPA, comments that interest in UK pulses for domestic and export trade remains good and bodes well for the produce of harvest 2016. Markets are good, demand is good - and even though the prices are not as high as growers would like, compared to other commodity crops, the outlook for pulses looks relatively strong.
Feed beans have continued to rise in value slightly through recent weeks. Current values are around £127/t ex with short sellers trying to take cover. The most perplexing issue appears now to be the lack of beans in the market. Where have they gone? Growers saving seed for spring sowing and sellers holding back until the change of the tax year might provide some of the answer, but by no means all. The lack of a firm grip on UK supply and demand remains a conundrum.
New crop contracts are available with a value of £135/t ex with up to £10- £20/t on specifications as a non-default premium. Alternatively, the specification premiums are available without a base price guarantee.
Human consumption beans continue to be affected by the moisture levels experienced at harvest and, in many cases, less than ideal drying and storing conditions. Grains have oxidised, darkened in store and missed the grade as a result. Further decreases in the value of Sterling continues to help exporters, driving interest with buyers of UK crop. There appear to be few sellers of human consumption quality, but prices of up to £160 ex farm are available for the very best - a premium of around £35/t over feed. Whilst increasing demand alongside decreasing availability is pushing prices upwards, as the year progresses, the opportunity to consign bulk vessel quantities dwindles. And though containerised exports remain a possibility, packages of good quality produce brought to the market late may miss the opportunity this market currently represents.
UK sellers are vulnerable to the problems of unenforceable contracts, dampening the enthusiasm for forward trading of 2016 crop at this early stage. Lack of adherence to contracts by export buyers, if the market moves against them, puts sellers in a potentially unenviable position. UK growers are currently showing little interest in marketing their new season crop.
For combining peas, the story remains the same for marrowfats and little if any remains in the market that is off contract. Nominal values are suggested at £250-270/t ex, with values for new crop circa £250-275/t ex. There remains strong demand from growers, but contracts and seed availability are now in short supply. Marrowfats are moving steadily through the trade and it is anticipated that there will only be a small carryover if any at all. Export demand is beginning to increase and it is evident that the snack market is playing an important part in the continued growth of the industry.
Large blue pea exports to Northern European destinations and further afield have been strong recently. Due to Canadian prices and demand from India, blue peas are starting to move in large tonnages. Prices have increased proportionally. This demand for blues is likely to continue - especially as the UK quality has been universally accepted due to its unrivalled traceability and quality standards. It is significant that, due to this, Canada is now trying to source UK blue peas.
Any surplus as the new crop comes to harvest is now likely to be manageable - an ideal situation that will allow continuity of supply to be maintained into the domestic and export markets. This is a good sign for producers as markets and buyers will remain interested and engaged presenting a profitable outcome for the grower, so long as quality is maintained. New crop prices are indicated at up to £180/t ex and some production contracts remain available. Demand for old crop remains with values around £150-160 /t ex.
For many years, yellow peas have been grown in tiny quantities in the UK with a domestic production of perhaps just 2000 tonnes. Values are usually uncompetitive vs. imports, but prices for yellow peas in 2015/16 have attracted significant attention and it is anticipated that the area grown in 2016 will rise significantly in percentage terms. There is currently no trade, but nominal values are suggested at circa £165/t ex.