Lentils & Beans Market Report 09.10.24
Lentils
As the top exporter worldwide, conditions in Canada significantly influence the lentil market. Another important factor is India's import activity. With favourable conditions in Canada, the market has relaxed, but it appears to be recovering due to low supply and strong demand.
France: After three years of poor yields, France has had a good harvest of lentils. Yields are projected to be between 1.5 and 2 tons per hectare, which could result in an estimated harvest of around 20,000 tons. However, the ongoing bruchid infestation remains a concern, and the industry lacks effective solutions to combat it.
Canada: Although production estimates have risen, the market seems to be strengthening for cyclical reasons. First, there is a shortage in the market and production schedules are full, making it difficult to meet global demand. Additionally, congestion at Canadian ports and the potential for strikes have created pressure on the supply chain. Canadian farmers are also holding onto their stocks, anticipating a market rebound. If demand stays consistent with the beginning of the season, farmers’ expectations may prove correct. We may have to wait until the end of the first quarter to fully understand the market dynamics on lentils.
Overall, the market has adjusted to the expectation of higher supply compared to last year, providing some relief from the tight conditions of the past two seasons. However, the recent increase in Canadian lentil prices indicates that demand remains strong.
Beans
While lentils show some promise, beans present a more complex situation this year. Particularly with dark red kidney beans, which have been especially affected.
France: It’s still early for precise predictions, but the outlook appears positive as farmers prepare for harvest. Following a strong 2023 with yields above average (3 to 4 tons per hectare), 2024 is likely to return to more typical levels. However, strict water quotas, rising production costs, and the challenges of bean cultivation have led many farmers to reduce plantings. Additionally, a sharp decline in organic sales has negatively impacted the industry. This has previously benefitted from higher profitability in haricot bean production.
Argentina: This year, there will be very few Argentine dark red kidney beans available for export. The estimated 8,000 tons produced are of poor quality and don't meet European standards. The situation for white beans is mixed but dire, with production at around 30% of normal levels and quality again below standards. The pesticide risk is higher than usual. Meanwhile, the conditions for black beans and cranberry beans are more typical.
USA / Canada: The USA (+28%) and Canada have increased their plantings of black and pinto beans to cater to their primary market, Mexico. Consequently, plantings of red kidney beans and small white beans have declined. The USA expects a crop of approximately 70,000 tons of kidney beans, while Canada anticipates about 20,000 tons. North American producers are holding onto their beans due to the situation in Argentina, being fully aware of it.
In fact, there are currently no offers for kidney beans in the USA as sellers wait to have their quantities in hand, having already pre-sold a significant portion of their crop as usual. For GN beans, the issues with Argentine Alubias are affecting prices, which are now at historically high levels. North American sellers, who are retaining their stocks, are benefiting from this market dynamic. GN production is estimated at around 60,000 tons, with 45,000 tons expected from the USA.
Egypt: In Egypt, where official data is scarce, the country is seizing the opportunity created by Argentina's supply issues, particularly for Algeria, a key market representing 35,000 tons. This year’s circumstances may lead to a more established presence for Egypt in various countries, potentially diminishing Argentina’s market share in the future - definitely a source to monitor.
China: Heavy rains during the later stages of crop development have caused significant damage, reducing expected harvests from 40,000 tons to an anticipated 10,000 tons.
Green Peas
The pea market centres on yellow peas for protein extraction, while green peas are becoming less of a priority. Additionally, crop yields in France and Eastern Europe have been disappointing, bordering on disastrous.
France: The pea harvest across the country has been very poor due to unfavourable weather conditions. We hope that the next crop will be more successful and that the resulting high prices will encourage farmers to plant during the winter.
Eastern Europe: The situation in Eastern Europe is equally dire, with crops nearly completely dried out.
Canada: Canadian plantings have increased by about 3% compared to 2023, though they have not returned to the levels seen from 2014 to 2020. While green peas remain a small segment compared to yellow peas, their share has reportedly risen by 15%. This is encouraging, as postponed demands from France are likely to shift toward this origin.
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