Markets

Pulse Update:  Lentils lift further, India open to mungbeans

Liz Wells, May 17, 2021

Dry sowing lentils on the Adelaide Plains in South Australia. Photo: Nathan Parker

 

PRICES for current-crop lentils continue to climb amid market speculation that India will reduce its tariff to supplement local supplies.

Hopes for this have been buoyed this week by the Indian Government removing restrictions on green and black mungbeans and pigeon peas until October 31.

On the production front, Australia’s mungbean harvest is around two weeks from completion, and chickpea, lentil and faba bean crops are now being planted.

In Queensland and the northern half of New South Wales, recent rain is allowing chickpea and faba bean crops to establish in good to ideal conditions.

In Victoria, much of South Australia and in southern NSW, lentils have been sown dry and need rain soon to ensure an even and timely germination by early June.

All prices quoted are AUD unless stated otherwise.

Chickpeas

Traders report activity in the prompt up-country chickpea market is negligible as growers focus on harvesting their summer crops and planting their winter crops.

Limited activity is occurring in the delivered container terminal (DCT) Brisbane market at around $760 per tonne.

This equates to a delivered Darling Downs price of $700/t, which is nominally up around $30/t on last month.

“We have no offers up country, and the grower is not selling,” one trader said.

Escalating freight rates for containers out of Australia have further decreased trade interest in shipping chickpeas.

“Prices that are there aren’t workable for the trade,” another trader said.

Meanwhile, new-crop desi chickpeas are being planted in Queensland and NSW in the front end of the seeding window which will stay open until late June.

Faba beans

Prices for faba beans have firmed in the past month to around $350/t delivered Wimmera packer, up from $330-$335/t seen mid-April.

One part-cargo of faba beans is to be shipped to Egypt from South Australia in coming weeks, but export business is otherwise going in containers, with India the main buyer.

ETG Wimmera-based pulse trader Todd Krahe said the domestic market was putting its hand up for fabas.

“A lot is going into the domestic feed market.”

Graziers and mixed farmers in the Victorian Mallee and Wimmera districts are concerned that dry weather might continue.

They are busy planting their winter crop, and many have decided to hang on to fabas they have on farm in case they need to feed them out themselves, or can find a domestic premium in coming months if conditions stay dry.

Agri-Oz Exports general manager François Darcas said the faba market has firmed in the past fortnight.

“It’s hard to say if it is due to strong buying interest or reluctant farmer selling,” Mr Darcas said.

While fabas are grown in NSW and southern Queensland, most of Australia’s crop is grown in South Australia and Victoria.

“The autumn break has not yet really arrived in Vic-SA.

“Possibly some hectares will get cut, and it is not an ideal start for what is sown.

“We need rain soon.”

 Lentils

Australian lentil prices have rallied by up to $150/t since early March, and both Nugget and Nipper types are trading at $860/t delivered Wimmera packer, and $885/t delivered SA packer.

“A lot of it is speculation driven, and it’s also being compounded by freight issues,” Mr Krahe said.

“Buyers are having to bid for whatever they can find.”

Bulk is shifting a greater proportion of lentils than normal to markets including Bangladesh, Egypt and Sri Lanka as container rates become prohibitively expensive.

Bulk rates have therefore risen due to increased demand.

Meanwhile, dry planting of new-crop lentils is under way in Victoria and SA.

Mr Krahe said indications were for a lentil area at least as big as last year’s, when above-average yields lifted the national crop to an official figure seen at around 600,000t, well behind some trade estimates of more than 800,000t.

“Growers we’ve spoken to have at least maintained (lentil) area on last year, but we think it will be up 10-15 per cent.”

While an average-sized lentil crop seems entirely possible for this year, the chance of it being as big as the current crop seem small given the dry start.

Mr Krahe said lentil crops were made in spring, and the lack of rain in May to date did not mean a below-average crop should be expected.

“We can have a dry start, and we rely on a kind spring to get the crop home.”

He said the combined pace of bulk and container exports was likely to clean out reserves before new-crop came on stream in November-December.

“We’ve been exporting at a very high rate, and we’ve probably got enough supply to get to September.

“There will most likely be a period where we have empty silos ahead of new crop.

Mungbeans

Delivered-packer prices for mungbeans are steady to a touch dearer on those quoted in April, with No. 1 grade at $1300/t, processing at $1200/t and manufacturing at $1100/t.

Quality is mixed, and crops which had heavy and successive rain just prior to harvest have been downgraded due largely to discolouration.

Yields have varied widely, being anywhere from 0.2 tonnes per hectare to 3t/ha, with most in the 1-1.5t/ha range, and April rain in Queensland fell in time to bolster yields on later-planted crops.

.At Dalby, Deacon Seeds general manager Mark Schmidt said if the weather stays clear, most of Queensland’s mungbeans would be harvested by the end of the month.

“We just started to have some really nice beans come in and then it rained again,” Mr Schmidt said

Mice are active in parts of NSW and Queensland, and have been nibbling away at some mungbean crops.

Because mungbeans are machine dressed, any damaged seed is graded out as part of standard procedure.

“Mice, rain, drought, and heat at flowering have all affected yields.”

Some unseasonal hail has wiped out a few mungbean crops north-west of Dalby.

Mr Schmidt said export sales are ticking over, and the relatively small crop has enabled packers to get the containers they need to fill orders.

“China’s gone really quiet over the past month; most product is going to Vietnam, Thailand and other small markets like Hong Kong.

“If China comes back, the stock will be gone very quickly.”

Traders are also reporting interest from India now that its tariff on moong has been removed, and the market is working to find a level.

North and South-east Asian channels are cheaper and easier to get containers into, and higher freight rates on top of quality issues for some of the crop, is making price discovery into India challenging.

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