PULSE MARKET UPDATE – JUNE 2021

At one point in the extended winter that was April, there was concern that drilling was late and the soils were saturated and cold. The situation continued through most of May. Since then, with the sudden increase in temperature the crops have “taken off” and around the country the general consensus is that the pulse crops although a touch later, look superb. Crop area would appear to be up a little on 2020 harvest but as always we will only really know what has happened after the DEFRA June survey is published in the autumn.

Confidence is growing, with the caveat that we are still a long way from harvest, and the prospects for new crop availability look significantly better than that of the last year.

Domestic demand continues to rise and an increase in availability will further drive enthusiasm. Buyer confidence buoyed by the feeling that they can commit to the UK crop and be assured of availability. There is nothing like the lack of availability for dampening  interest.

With the 2021 Australian crop being sown now it is anticipated that the area and yield will return to more normal levels this year. Last year’s yields having been driven skywards by unusual levels of additional rainfall. Baltic region production is anticipated to be much the same as 2020. This means that some of the more traditional market opportunities for UK pulses 2021, could well return in the autumn.

UK Pulses

Feed Beans
Following values in March/ April falling to around £205/t ex farm bean prices have rallied again and are currently holding steady at around £225/t ex farm. With some continued demand from European buyers (including Spain and Scandinavia) , domestic feed values are being held at this level by the need to fulfil short contracts. Demand is holding well and whilst wheat futures for the autumn are all over the place at present a premium of £30/t for beans is a realistic expectation for any forward sellers.

With future values of mid-range proteins falling a little recently (e.g. predicted increases in availability of DDGS, soya and rape meals) these values for beans do not make them the cheapest alternative. However, they do not always need to compete on protein alone, as they have other functional properties that hold some residual value in processing.
Interest in beans from processors for feed continues to increase. It is also believed that the practice of saving beans on farm for feeding is also increasing.

Human consumption beans
Whilst there is some processing for human consumption taking place demand is absolutely minimal at this time. The market is essentially all but fully supplied. Historically this market took up to 250,000t of UK produce at it’s peak. Last year significantly less than 100,000t was shipped. This was largely dictated by low crop volumes with good visual quality from the UK and huge availability from Australia.

Looking ahead there is a cautious view of this opportunity. Limiting barriers are presenting themselves. These include:

•  unknown quality from new crop
•  massively restricted opportunity to fumigate cargos due to safety regulations
•  hugely inflated container freight costs, an international shipping phenomenon
•  rising strength of Sterling  against the US$
•  old crop stock availability from Australia and their new crop arrival date.

Interest is unlikely to return until a little nearer harvest.

Combining peas
The pea market remains very quiet. There is no notable demand from domestic markets that is not already covered by existing contracts. Internationally, prices for yellow peas have been rising on the back of increasing demand and uncertainty of supply.

Marrowfat peas
Crop area is almost certainly significantly lower in 2021 than it has been for many years. Following reduced yields from crop 2020 this is causing some concern about the availability of produce for selling in 2021 /2022. This may be exacerbated by the increasing demand of domestic consumption with staycations following the pandemic as folk head for the coast and traditional fayre.

Rather unusually, come harvest any free market growers with good samples could be of interest to the market.

New crop contracts for crop 2022 and 2023 are already available and are attracting significant grower interest. There are merchants ready with commitments to significantly higher values and differing quality clauses. Interested growers will have a choice to make about their attitude to risk and potential rewards being offered.

Green/ Blue peas
Green peas remain more plentiful in the market and contracts for crop 2022 and beyond are not yet being offered. This situation is likely to change nearer to harvest.

Mid-range quality produce remains valued at around £265/t ex farm but most crops will already have been settled on contract by now.

Yellow peas
Typically open market yellows are trading at a premium to feed peas of about £10-15/t ex farm

Demand in this market continues to grow. The pace of development is uncertain but it is real and set to continue for a long time. As previously mentioned, internationally this market is not going to go away and would appear to have a bright future.

Crop 2022 contracts are not yet available. Interest will gather nearer to harvest 2021.

Maple peas
Contracts for crop 2022 are not yet being offered. Interest will gather nearer to harvest 2021.