PULSES MARKET UPDATE – JANUARY 2021
For the last 6 weeks or so, grain commodity prices have been on the rise. At the time of writing wheat values have risen to astonishing highs, well over £210/t. Most other crop values, including pulses have risen too, although pulses have experienced some lag.
It is not unusual for pulse values to track the prices of other commodities, particularly those considered to be alternative providers of mid-range proteins. Historically price responses are not normally instant, frequently slower to rise and equally, slower to fall. The speed of the current rise has however eroded the normal premium for pulses.
The Australian bean crop harvest has been re-evaluated. A typical year would yield about 300,000 – 330,000 tonnes and whilst it has been known for a while that crop 2020 was going to be significantly larger, the anticipated 450,000 tonnes now seems to be a significant under-estimate. Yields as high as 600,000 – 700,000 tonnes are now being suggested. With this quantity of good quality beans available to the traditional export markets offered at UK feed bean values, the opportunity to export for human consumption for the UK trade is effectively over until crop 2021 is seen.
There is believed to be a significant uplift in the winter bean sown area in England compared to 2019/2020, helped by what was a drier autumn. It is too early to make a firm estimate of total crop area as of course spring sowings are still to take place. We are reminded that the AHDB Early Bird survey suggested a potential 7% increase in pulse cropping in 2021.
Prices have firmed slightly on the back of other commodity increases, especially wheat, soya and imported peas. Whilst soya has eased a little recently, applying a slight break, beans have started to look more attractive to some feed compounders. There have been significant EU based export trades, as well as emerging demand from UK feed mills. Growers appear slightly reluctant to sell, with current values ex farm around £220/t.
Currently there is only a little seller interest in new crop. Offers are tentatively around £200/t ex farm. A premium of about £30/t over November wheat futures. Prospects for demand remain good.
Human consumption beans
On the back of a colossal Australian crop offered ex UK farm prices, this market has effectively closed to UK traders until new crop arrives. The pressure is not only from availability, consumption has also fallen. A significant proportion of the beans exported are eaten outside the home and pandemic movement restrictions in the destination markets have dramatically reduced demand
The Pea market is generally quite quiet, but prices for open market parcels have risen a little with other commodity values. Demand for peas on the continent is high feed pea import values would be over £250/t port side putting them out of the market- but holding UK feed bean values.
Open market samples have now started to gain demand as contracts from 2020 crop delivered short. Quality however remains critical for interest. Good quality produce could fetch up to £315/t ex farm.
As mentioned previously, open market peas are frequently produced from farm-saved seed and tend to have more off types in the produce, making it harder to reach the top premiums. When contracted production comes up short, open market offers may receive greater buyer interest, but significant essential processing costs may be incurred to clean up the sample.
New crop contracts for 2021 are readily available, with for bonus payments for the best quality. Contracts are currently up to £335/t ex farm.
Green/ Blue peas
Green peas have more flexible marketing opportunities than marrow fats. Broadly, the best quality enter the snack and export market, followed by micronizing, canning and feed.
Pale / bleached lots which prove suitable for canning might realise £220/t ex farm, but samples with good colour retention could perhaps anticipate up to £280/t. The samples with good colour attracting interest from micronisers might even fetch over £300/t.
2021 crop contracts are typically available within a range £215 – £260/t ex farm and there remains significant grower interest.
Still remains a small market in the UK, though there is a view that yellow peas have a significant role to play in the future of UK pulse production and some currently small niche players are getting significant exposure. It continues to be reflected in health messages, flour production and snack processing. Interest, starting from a very low level within the UK, makes it difficult to detect a trend.
Availability appears to be limited with few suppliers. Offers will specifically reflect the immediate demand.
Crop 2021 contracts are available, but values remain fluid.
This is a small market, effectively spit between the varieties Mantara and Rose.
Rose is demanded for export, but it seems there is no old crop still to be marketed.
Mantara fills the niche for pigeon enthusiasts. There appears to be no sellers at this time but nominally valued up to £325/t ex farm if a buyer can be found.
Crop 2021 contracts were in demand very early with typical offers for Mantara around £300/t and Rose £325/t ex farm. It may already be too late to gain contracts for 2021 production. Ask your merchant.