Pulse weekly outlook: Canadian lentil prices remain stable

MarketsFarm – Early summer was characterized by concerns that dry, hot weather across the Canadian Prairies would impede lentil yields. However, recently improved growing conditions meant lentil crops have stayed largely stable.

“It’s a completely different scenario now than it was two weeks ago,” said Darwin Hamilton of Kalshae Commodities in Winnipeg. “A month ago it was too dry, now there’s rain.”

According to Alberta Pulse Growers, lentils are expected to maintain five-year average yields, around 2.2 million tonnes for 2019.

David Newman, owner of Commodious Trading Inc., says prices have stayed around 22 cents per pound for large green lentils.

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Newman surmised that while supplies have remained steady, producers are met with quiet demand, which has put pressure on prices.

Hamilton explained that there is continued lack of demand from the Indian market, and muted demand from South America.

“It’s pretty balanced,” said Newman. “When I talk to farmers, they say ’25 cents is my perfect number’ so it sort of makes sense that we’re just below that, with a little bit of demand.”

Newman said weather concerns made more of an impact in previous years when demand for forward sales was higher and carryover crop volumes were lower.

“I don’t mean to point out the obvious, but people make commitments, and if the crop isn’t happening then they’ll have to do something.”

Ahead of new crop, Newman expects prices to remain the same.

“For now, there’s stuff in the bin, and it’s not bad. It’s not a disaster. There’s a bit to lean on, a bit to transition with.”

Hamilton noted that the growing season may extend later into the year than usual, which leaves crops potentially vulnerable to early frosts.

“I don’t think prices are going to move anywhere, unless there’s an early frost that devastates the crop,” he said.

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