Pulse weekly outlook: Lentil prices seen as too high, sales stalling

'Destination markets are not in desperation mode'

(Lentils.ca)
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MarketsFarm — Prices for pulses, such as lentils for example, have been approaching the point where they are good for growers but getting too expensive for the destination markets, according to Marcos Mosnaim of Mercaris Commodities.

“It’s a kind of an interesting scenario, where you see farmers not selling and prices to farmers keep going up and up. The trade cannot cover their positions selling at lower prices. Destination markets are not in desperation mode to buy products,” Mosnaim said, noting the latter is only buying “hand to mouth, with no rush to buy more.”

He couldn’t place a finger on one particular reason, but believes it’s a combination of factors, including the global COVID-19 pandemic.

He suggested the pandemic has resulted in people in less fortunate countries having only enough money to buy the cheapest food they can find — and that transportation costs have risen to the point where customers have turned to buying local.

“It looks like a lot of markets bought a lot of products last year. The sales have not been as strong as they were expecting,” Mosnaim said.

“Why would you fill your warehouse with $1,000 lentils when a year ago you were paying $700 or $800?”

The true picture of what has been happening this year will come out eventually, he said. “In our industry, the beauty is every year is different, and we only know the reason why when it’s too late.”

— Glen Hallick reports for MarketsFarm from Winnipeg.

Table: Current lentil price ranges, in Canadian cents per pound. Source: Prairie Ag Hotwire.

Type Old-crop (2020-21),    . New-crop (2021-22)
delivered
Laird 22-40 22-36
Eston 22-32 30
Richlea 22-39 22-33
Crimson.    . 23.5-34 23.5-33.5

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Glen Hallick - MarketsFarm

Glen Hallick writes for MarketsFarm specializing in grain and commodity market reporting.

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