November 2017

QUALITY ISSUES HAVE CONTINUED TO DOMINATE THE UK TRADE ...

"Perhaps the most significant news during the last month was not from the UK but the apparently snap decision of India to impose a 50% tariff on all imports of peas," comments Roger Vickers, Chief Executive of PGRO. "India are the largest importer of pulses on the world market and this move is likely to put pressure on exporters - particularly of yellow peas - to focus on other markets which is likely to push values lower in the short term. https://goo.gl/FmGT6U

"Australian bean crops are heading towards harvest. Crop areas are significantly down on the records of 2016, so the bumper supplies that came to the human consumption market over the last 12 months can be expected to decrease. As we publish the southern states of Australia stand in anticipation of potentially huge rainfall event that could significantly harm harvest in the productive south eastern region. https://goo.gl/fga2KU

"Quality issues have continued to dominate the UK trade. The lack of quality is handicapping export opportunities and increasing availability for feed dissuading buyers from longer-term commitments. Anecdotal reports indicate that the area of winter beans has increased, with growers taking advantage of the more open autumn conditions, perhaps hoping for a slightly earlier harvest and reflecting on generally good yields of winter beans 2017."

Franek Smith, President of BEPA, reports that the market for Feed Beans in the UK is relatively slow. Feed buyers have a number of competing mid protein sources and are in no particular rush to make longer term forward commitments having largely secured their pre-Christmas requirements. Buyers are reluctant to come to the market at present perceiving a good supply and potential downward price pressure. Values are currently around £145/t ex farm depending upon location.

For Human Consumption Beans, it appears that the Egyptian export market is currently full and is unlikely to restart until stores are cleared. Significant carryovers from Australian old crop and competitively priced Baltic sources have made up for the reduced availability from the UK.

There are currently few if any buyers, making trying to put a price on human consumption field beans a theoretical exercise. Traders are generally pessimistic about finding additional volumes of good quality in the UK to make up bulk boat exports, and no new boats are scheduled.

The Sudanese market for containerised product is still active and enthusiastic but the window is closing rapidly as all cargos must be cleared on arrival by mid-February. Considerable logistical issues have been encountered at the port of destination making shippers reluctant to continue for much longer.

Whilst the news in this market is not fantastic, the UK's ability to supply in 2018 has been significantly reduced for reasons of quality and most producers who made the standard have fared very well indeed.

The quality of Combining Peas again remains the watchword. Producers who have retained quality will be enjoying an increase in values as the market strengthens. In turn, the reduced availability of quality product in the market is having a positive impact on contract prices going forwards.

The market for Marrowfat Peas continues to be dogged by issues with excess bleaching and contamination. Those with <10% bleaching may attract offers up to £250/t ex farm, whilst bleaching of 10-20% will take £20-30 discount. Samples poorer than this are likely to head for the feed market - if takers can be found - and may drop to £140/t or less in the current market. Contracts for 2018 crop exist with offers up to £275/t available.

Availability of good Large Blue Peas is falling with prices rising up towards £230 /t ex for top quality. Lower quality bleached samples are more likely to be in the region of £155/t and, if destined for feed, some £10-15/t below that. Contracts for 2018 crop can be obtained with min max values £200 – 230 /t ex farm.

The domestic market for Yellow Peas is still very small but with signs of growth. To a certain extent it is therefore slightly insulated from the short-term international market fluctuations. Current values for good samples are around £175/t ex. Most yellow pea growers enjoyed good yields in 2018 and benefitted from an early harvest. Yields of over 6t/ha were reported. Contracts for 2018 crop exist with min/max values £170- 200 /t ex farm.