Pulse Market Update (11.11.13)

International overview

The Canadian 2013-14 pea harvest has been huge. Estimated at 3.75 million tonnes, crops benefitted from a late moist spring, a cool July flowering period and a hot August. Initial suggestions that this might put a cap on UK pea prices are perhaps not as strong as they were as Canadian export potential to their regular Indian markets has risen with a stronger Indian currency and political changes. There are, however, no certainties.
 
Australian crop reports are generally good but there are some suggestions of pod setting issues following abundant flowering. The Australian crop will start to compete from the end of November and will put further pressure on the Human Consumption market price for beans.

French pea crop analysis shows that, whilst yields were good, the average protein levels (22.4%) were the lowest for 10 years - and that in certain regions nodulation was adversely affected by waterlogging disrupting nitrogen fixation. The bean crop 2013 is down 40,000t, despite a 14% increase in area. Exports will be very low for human consumption beans, but exports to Norway for fish feed are already ahead year to date of 2012/13 - which saw a very significant jump on 2011/12. UK trade has benefitted enormously from the lack of French export quality beans from crop 2013.

In Egypt, politicians are seeking to drive local production, but the impact potential of this on imports of any single crop is considered to be small. Trade has been brisk.

Field Beans - general
With continued interest in the bean cropping and with the winter bean sowing period upon us, the area of beans sown this winter is anticipated to reach up to 55,000 Ha. A dramatic increase on crop 2013 which was for a number of reasons, (not least of which was the appallingly wet conditions) at an all-time low. Winter bean seed and production contracts remain available.

2013 bean crop estimates are in the region 430-480,000 tonnes with a potential export market of up to 200,000 tonnes of which 50% has already been supplied.

Feed Beans
With later harvest crops needing to be dried to reach feed contract suitability, and sellers holding out for Human Consumption premiums, beans have been short in the market. Feed beans are in demand and prices are high, remaining around £220/tonne ex farm. A healthy premium over feed wheat ensures the crop is an attractive proposition. Many growers are reporting for the 4th year in a row that beans are the most profitable crop in their rotation.

Human Consumption Beans
The UK has now shipped more beans for export in the periods to the end of October than from the whole of the 2012 year crop. This said, the market has gone relatively quiet with the export markets of North Africa having full supply chains and a relatively strong UK currency. Interest is expected to return towards the end of the year - but by then the Australian crop will also be a known commodity.  Premiums over feed beans have been heavily eroded and are now in single figures due to demand in the feed market and a large proportion of the 2013 crop making human consumption grade. Prices, however, remain good.

Combining Peas
Pea prices are holding up well with good trade. It is unlikely that there will be any surplus to carry over - good demand for UK produced quality peas looks set to remain. The UK crop yielded an average of around 3.5 t/ha but some growers benefitted from significantly higher returns. Marrowfats continue to command around £350/tonne with deductions for poor colour, and Blue Peas slightly lower up to £330 for the very best quality.

Buy back contracts and seed are available for crop 2014 with fixed price, market price or maximum/minimum terms.  Peas continue to present a strong economic case and there is significant interest from growers recognising their potential in the war against blackgrass. The autumn has been open and there is uncertainty about available land for spring cropping. It seems peas from crop 2014 will continue to have a good market and value.