Tight supplies and weather concerns in Saskatchewan are helping to boost new-crop red and green lentil prices in Western Canada.
Prices in the country for new-crop red lentils are sitting around 35 cents a pound, with prices for large green lentils just a couple of cents below that, said Gerald Donkersgoed of Finora Inc. in Surrey, B.C.
In Saskatchewan, by far Canada’s largest lentil-producing province, conditions have been dry. It’s not just the parched soil moisture levels that have the trade concerned, however, but also the lateness of the crop.
“We had a cool spring and green lentils in particular are a long-season crop. We’re looking at a delayed harvest and the possibility of less-than-stellar quality if frosts are early,” Donkersgoed said.
Nervousness about these early crop complications are underpinning values, he said.
“With no lentil stocks left in the world, everyone is totally dependent on new-crop supplies. Unlike wheat, there is no large residual year-to-year, we just don’t have that,” he added.
Besides keeping an eye on the development of the Canadian crop, Donkersgoed said events shaping up in competing countries should also be monitored.
“Unfortunately, someone else’s calamity is often our fortune,” he said.
Lentil production in India this year could be threatened by a drier-than-normal monsoon season, a possibility Indian government officials have warned of in recent days.
“India is a focal point of the global pulse trade. They’re the largest pulse producer but typically have a deficit each year. So, if they’re even shorter than normal, that bodes well for our exports,” Donkersgoed said, adding that only time will tell whether or not the weaker monsoon actually materializes.
Another country to watch is Turkey, now harvesting its lentil crop. It seems its crop was delayed and plantings were reduced due to a shortage of plantable seed, Donkersgoed said.
Early optimism that its yields would return to normal has given way to increasing uncertainty as to whether or not that actually happened, he said.
Potentially higher export demand and crop problems in Canada could bode well for cash prices down the road but an offsetting factor is the increased amount of land that was seeded to lentils this year.
Statistics Canada’s 2009 seeded acre report released June 23 pegged lentils acreage in Saskatchewan at 2.32 million acres, compared with 1.61 million acres last spring.
“Buyers will tell you that Canada planted a large crop and they take comfort from the fact that we’re supposed to have significant production,” Donkersgoed said.
At current price levels, a less-than-ideal start to the growing season has not scared growers off from contracting new-crop lentils. They have been scale-up selling, which is very prudent, Donkersgoed said.
“Farmers do a marvellous job marketing their grain, they have learned very well over the years,” he said. “There are people out there who think farmers are unable to market their own grain and need assistance but we have a lot of respect for how farmers watch the market and sell their grain,” he said.