IN SPITE of a record Australia chickpea crop, strong international demand is likely to provide a solid floor in the market, according to a pulse exporter.
Sanjiv Dubey, director at newly set-up Graintrend, but well-known to the pulse industry through his involvement with marketing business OzEpulse, now a part of GrainCorp, said a large northern NSW crop had pushed the chickpea harvest to record levels.
Mr Dubey said the total pulse crop was over 700,000 tonnes, close to 40pc above the 2011-13 crop.
Of this, around 90pc are the smaller desi type of chickpea, which is the major crop in northern NSW and 10pc are Kabulis, grown primarily in Victoria.
Mr Dubey said, as with all pulse crops, demand out of the subcontinent was critical.
He said Indian government policy, which heavily subsidised wheat plantings, was a positive for Australian chickpea producers.
“The subsidies in place mean farmers in the main chickpea producing regions of the north-central states of Madhya Pradesh, Uttar Pradesh and Rajasthan are now very comfortable growing wheat.”
He said there would be average yields across India this year, but local production was expected to be two million tonnes shy of Indian demand of 16.5mt, at 14.5mt.
“There’s good demand in the medium term, I think Australian growers can really be happy growing large acreages of chickpeas and finding a home for them at a good price.
“There has often been a lot of volatility in pulse markets, but this ongoing demand will smooth this a little.”
Mr Dubey said the traditional pattern of a heavy October-December export program to fill the gap prior to the subcontinental harvest coming on line in March would be slightly different this year.
“We’re expecting to be busy in January and February this year, because of the continued demand, and then by March and April, Bangladesh and Pakistan, with their pre-Ramadan demand, a traditional buying period for them, will be looking for supplies.”
Mr Dubey said Australia had already exported significant amounts of chickpeas to India.
“A total of 10 bulk vessels, carrying about 225,000mt of chickpeas left Australia from October to December, along with around 200,000mt that has been either executed or booked to go out in containers.”
Prices for desi chickpeas are currently at around $470/t upcountry, delivered to Narrabri, NSW.
In Victoria, kabuli prices ex-Horsham are at around $550/t, with Kabulis commanding a premium to desis due to their size.
Mr Dubey said marketers had an easier task this year, as quality was generally good.
“In terms of size, the dry finish meant seed size wasn’t as big as it could have been, but there was no problem with discolouration from harvest rain as has been the case in the past few years, so we’re happy with a good, average quality crop.”
Mr Dubey said Australia was strongly positioned as one of the few major export chickpea producers, but said the subcontinent was a price sensitive market.
“Australia is one of the few places that exports chickpeas, but in the overall pulse market it is a small player, competing against Turkey, Canada, Russia and the Ukraine.
“Should the price of chickpeas get too high, Indian consumers will switch to other pulse products, such as yellow peas out of Canada or lentils from Turkey.”
He said the products could be swapped for applications such as splitting or milled for flour.
However, in spite of that, he said he was optimistic about prices remaining firm.
“There’s certainly more upside than downside in the current market.”
While a large amount of Australian chickpeas have already been sold, he said there were still large reserves in warehousing or stored on-farm.
“Prices for chickpeas have certainly been higher, so farmers are happy to store some to see if demand forces prices higher.”
He said Indian buyers were increasingly happy to source chickpeas out of Australia, now that there was a larger and more reliable supply of chickpeas in Australia.
“The large Australia crop, and its efficient execution and export, has cemented the position of Australian pulses into the Indian sub-continent.”