Markets

Pulse Update: Bulk call drives lentil, faba markets

Liz Wells, January 19, 2022

Chickpeas stored on farm post harvest at Pallamallawa in northern NSW. Photo: Oscar Pearse

PRICES for faba beans and lentils have surged and fallen several times since November to reflect spot demand for bulk shipments, while the chickpea market flounders amid limited offshore interest.

Mungbeans prices remain firm as planting of the 2022 crop takes place in mostly good to ideal conditions, and a functioning trade route for containers to China and Southeast Asia.

The market for containerised pulses to South Asia and points west remains problematic, with boxes in short supply, unreliable delivery schedules and prohibitively expensive freight costs.

All prices quoted are in Australian dollars per tonne.

Chickpeas Faba beans Field peas Lentils Lupins
Qld 527,000 64,800 0 1,300 1,100
NSW 420,000 88,000 45,100 9,500 122,000
Vic 40,000 162,000 71,000 275,000 39,000
SA 11,000 190,000 85,000 350,000 45,000
WA 6,000 15,000 60,000 20,000 600,000
TOTAL TONNES 1,004,000 519,800 261,100 655,800 807,100

Table 1: Tonnage estimates for Australian’s major winter pulse crops. Source: ABARES December 2021 Australian Crop Report

Chickpeas

Demand for desi-type chickpeas harvested in recent months is thin, based on limited demand coupled with quality issues which arose in later crops.

Traders report quality from Central Queensland (CQ) and Queensland’s Western Downs was very good, but rain caught most crops in the Narrabri and Moree regions of New South Wales.

While several cargoes of Queensland new-crop chickpeas have been shipped, mostly to Bangladesh, stained chickpeas harvested in all but the earliest-maturing areas have met thin demand.

Broker Peter Wilson said Pakistan, where chickpeas are primarily processed into dhal or flour, is the logical market for the weather-affected seed.

“People aren’t energised to push it because we don’t have a surplus of freight,” Mr Wilson said.

“The market’s thin.”

Traders report accumulation of No. 1 grade chickpeas for bulk shipments to go to Bangladesh has slowed.

Growers in NSW with stained chickpeas appear to be in no rush to sell them, as wheat and barley markets have been strong.

Also, many NSW chickpea growers have a big sorghum crop getting close to harvest, and this will generate further cashflow.

Faba beans

Bulk shipments of faba beans are flowing out of Victoria and South Australian, with Egypt the major market.

One trader said expensive and difficult freight for containers going to the Middle East and South Asia has seen some Australian faba beans delivered to Egypt for packing into containers for reexport.

“Red Sea markets are buying Australian beans out of Egypt, because that’s the quickest and cheapest way to get them there at the moment.”

Australian Grain Export pulse trader Will Alexander said growers have withdrawn their selling interest now that prices have fallen.

“We sure some serious pressure on beans; the prices went crazy up and then flying down.

“Fabas went up to $700 a tonne during harvest, then they went down to $400 and something delivered packer.”

“There’s no grower selling at these prices.”

Spikes in the market are appearing when exporters have a vessel to fill which has slotted in among the profusion of wheat, barley and canola cargoes on the Victorian and South Australian shipping stems.

The next run of export demand is expected to lift prices and pull some fabas out of on-farm storages.

“Whoever’s got cheap freight is going to do fabas.

“There’s huge demand from Egypt, and there’s a floor here.”

That has come from the domestic market, which uses faba beans if they are priced right.

Lentils

In its daily market wire today, Lachstock Consulting said lentils were well bid in South Australia at around $1000/t, while packers in the Victorian Wimmera were bidding at more like $800-$850/t.

Mr Alexander said the shortage of containers was impacting lentils as well as faba beans.

“People doing bulk can pay more to the grower because their freight is significantly cheaper than people selling in containers.”

“When people need to load boats, prices go up.”

As is the case with faba beans, growers are being careful not to put supply-side pressure on the market.

“They’ve sold what they want, and they’ll store what they can.”

Mr Alexander said he expected prices for lentils to hold in coming months through Turkey’s and India’s harvest, and ahead of the Canadian new crop.

Growers in South Australia and Victoria have made good money through selling their canola, wheat and barley at harvest, and are expected to pick the eyes out of the lentil market when prices surge.

Mungbeans

The first new-crop mungbeans have arrived in the past week at Queensland container-packing sites to pick up where old-crop has left off.

Deacon Seeds general manager Mark Schmidt said prices for manufacturing-grade mungbeans are holding at $1100-$1125/t, and $1200/t or more for processing.

“China is still in the market to buy, which is really encouraging,” Mr Schmidt said.

While the area of the crop now being planted is expected to be in line with last season’s at 100,000-125,000 hectares, Mr Schmidt said the yield prospects appear to be higher.

“Most of the crop was planted on a full profile of moisture, and some rain now wouldn’t hurt to maximise yield potential.”

That is seen at a comfortable 1t per hectare, in line with last year and the long-term average, with potential to hit 1.5t/ha if a further 25-50 millimetres of rain falls soon.

CQ growers are planting mungbeans now, and will continue into February, while early crops in NSW and southern Queensland are close to harvest.

“We’ll see the bulk of the harvest from mid-February into March and April, because most of the crop was planted late November or early December.”

Traders estimate around 100,000t was exported from last season’s crop, and this season’s should achieve at least that.

Along with sorghum, mungbeans are the major grain export going to China, where shipping services and rates are much more conducive to doing business than those to South Asia.

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