Pulse Market Update from BEPA and PGRO for May 2015, issued on 8 June

BEPA Chris Collings“Trading of old crop is essentially complete despite the occasional enquiry and prices have continued to fall in line with other commodities, ” says Chris Collings, President of BEPA (British Edible Pulse Association).

Looking at international markets, he notes that French crops continue to develop without drama with prospects for production ex 2015 appearing normal. While in Egypt, local trade is focussing on selling locally-produced bean stocks on hold for Ramadan. It is expected that stock will be taken of supplies by mid-July and that interest in imports of new crop will by then have been initiated.

“The outlook for wheat and maize harvest 2015 worldwide is good, putting continued downward pressure on the markets. At the start of April, prices for feed beans were around £204/t ex, but fell throughout the period. At the end of May, old crop feed beans if traded were reaching circa £185/t ex. Feed wheat has fallen further to circa £109/t ex.

“New bean crop selling opportunities exist at circa £140/t ex, so that is a significant further discount on today’s prices but still around £30/t premium over feed wheat - these premiums have been lower in the past. With new crop OSR priced at around £230/t ex, and potential further discount for 2016, beans continue to present an attractive proposition.”

In the UK, he notes that with area of human consumption beans is up on 2014 crop, and both winter and spring beans are in generally good condition, with little disease to worry growers. Hence, post-harvest availability prospects look good. Uncertainties that may affect values are always present - with the much-publicised developing El Nino event in the Pacific being the most significant - although this is more likely to adversely affect Australian bean production, and may negatively influence their decision to plant in the months ahead. There is, however, the potential for a lot to happen before harvest and there is very little buyer interest at the present time.

Estimates of forward premiums for human consumption beans remain at £20- £30 /t over feed bean values - and with larger crop areas in the ground and potentially more crop to harvest - the emphasis on quality is a must for growers. Turning to Combining Peas, the surplus of samples of large blue peas continues. Good quality samples of old crop are now valued at circa £185 ex. The 2015 crop could remain under pressure throughout. Attention needs to be paid to achieving good quality, and growers without contracts should be very aware of the market conditions. Delivering good quality produce will be critical to retaining crop values.

The marrowfat pea story continues unchanged. Restricted for 2015 by seed availability, the situation is unlikely to alter from the 2015 crop, with high returns anticipated for good quality produce. Retaining a good visual sample is essential and cropping priorities need to be orientated towards achieving this. The trade is already reporting significant interest from growers for crop 2016 pea production. Growers should be sure to secure a production contract.

The market for dry peas – especially marrowfats - has been undersupplied for a number of years but in 2015 with a good potential harvest the market could be satisfied. Despite an encouragingly rising market requirement, it would be easy to flood this sector. Marrowfat pea production carries some risk and requires high quality produce to command best values and returns. Peas which fail to make the grade are likely to trade at a significant discount - below the value of feed beans. Lastly, white pea production represents a tiny market in the UK of some 5000 tonnes and it is believed that it has all long since gone, he adds.