The exemption was set to expire May 31, 2025.

Vivek Agrawal, managing director of JLV Agro, an Indian commodity brokerage firm, said the policy change is good news for Canadian farmers and Indian consumers, but it wasn’t well received by Indian traders.

“The market is over-flooded with all the pulses,” he said.

He expects pulse prices in India to remain stable or decline slightly in the wake of the announcement.

It is terrific news for Canadian farmers who recently lost their other top market for peas when China slapped a 100 per cent import tariff on the product in response to Canada’s tariffs on Chinese electric vehicles, steel and aluminum.

Canada shipped about 500,000 tonnes of yellow peas worth $306 million to China in 2024.

However, that was a down year. The five-year average is over 1.5 million tonnes valued at $740 million annually.

It would have been a disaster if Canada was also shut out of the Indian market.

AgPulse Analytica thinks India could import one to two million tonnes of the pulse in 2025-26, down from the 2.3 million tonnes in the current crop year.

Agrawal thinks 1.5 to two million tonnes of yellow pea imports sounds about right. It will be substantial, but not as high as last year.

Russia and Canada will supply those peas.

Russia will provide stiff competition to Canadian exporters because farmers in that country are expected to produce a crop of 4.5 to five million tonnes.

Agriculture Canada is forecasting 3.13 million tonnes of Canadian production by comparison.

Agrawal said Canadian exporters will need to slash their prices to match Russia’s bids of US$360 per tonne on old crop and $345 per tonne on new crop with July/August delivery.

“Maybe if China will pay a higher price, Russia can sell to China and Canada can sell to India,” he said.

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Canadian pea exports in September came in at 619,067 tonnes, which compares with only 16,524 tonnes the previous month, according to the latest Statistics Canada trade data. India was the largest destination, accounting for just over half of the 635,591 tonnes of total Canadian pea exports during the first two months of the 2024/25 marketing year.

Yellow peas made up 92 per cent of Canada’s pea exports so far this marketing year, with temporary cuts to India’s yellow pea import tariffs behind some of the increased demand there.

That temporary pause on yellow pea tariffs is set to expire at the end of December after being extended in September. Indian trade policies depend heavily on their own pulse production, with Canadian yellow peas used a substitute for pigeon peas and chickpeas in the country.

India is currently in the midst of its kharif growing season, with a Nov. 5 report from the Ministry of Agriculture and Farmers Welfare pegging total pulse production during the season at 6.954 million tonnes. That was in line with what was grown the previous year, but about a million tonnes below the five-year average. Tur, or pigeon pea, production was forecast at 3.502 million tonnes, up by about 100,000 tonnes on the year.

Chickpeas are grown during India’s rabi season, with the 11.039 million tonnes grown in 2023/24 down by 1.2 million tonnes from the previous year, according to Indian data. Early trade estimates on India’s upcoming 2024/25 chickpea crop call for another reduction.

Canadian yellow peas are currently trading steady around C$9.50 to C$11.00 per bushel, according to Prairie Ag Hotwire data.

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Sargsyan explained yellow pea prices increased when India slashed its import duties 10 months ago.

“I know there are targets for higher prices right now, but I’ve noticed that prices have backed off a little bit this week,” he said.

The broker quoted yellow peas at C$10.50 to C$11 per bushel, down from C$11.50 to C$12 as the India market is something of a question mark. The country’s government planned to end its levy reduction at the end of October.

“You need adequate time to get the product into India,” Sargsyan said. “That import window could be extended. I think if there is an extension … we could see renewed demand and maybe another bump in the price.”

As for green peas, the broker stated their price have remained firm at about C$15 to C$15.50/bu.

Canadian pea exports for 2023/24 totaled 2.40 million tonnes versus 2.57 million the previous year, according to Statistics Canada. Of the 2023/24 total, just over a third went to India after the country acquired none the previous year. That surge to India compensated for reduced exports to Bangladesh, China, Pakistan, the United Arab Emirates and the United States.

StatCan reported a sharp decline in pea exports for the first month of the 2024/25 marketing year. Only 16,539 tonnes were shipped out of Canada in August compared to 99,643 the previous August, with India accounting for 1.6 per cent of the total.

– With files from Phil Franz-Warkentin, Glacier Farm Media

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Spot bids for green peas have topped C$20 per bushel in parts of the Prairies, while yellow pea pricing can be found in the C$14 per bushel area, according to Prairie Ag Hotwire data.

While prices may be high, there’s very few green peas trading at current levels, according to broker Levon Sargsyan of Johnston’s Grain. He said supplies were tight, while drought projections also have farmers anticipating higher prices down the road as they begin spring seeding.

For yellow peas, a pause in India’s import tariffs accounted for solid export movement in recent months. The end of the duty-free movement has been pushed back a few times already, but tariffs are set to go back into effect at the end of June. Farmers are optimistic for another extension, but it remains to be seen what India will do.

“Once there is a bit more certainty with the weather and the politics (in India) things will stabilize one way or the other,” said Sargsyan on the market direction.

New crop pricing has not seen the same strength as old crop, but a move by India to extend duty free pea movement beyond the end of June would push that demand into new crop territory, which would likely support yellow pea prices.

If the pea market holds steady over the next month, Sargsyan expected there could be a shift towards more green pea acres this year – although yellow peas will continue to account for the bulk of the peas grown in Western Canada.

—Phil Franz-Warkentin is an associate editor/analyst with MarketsFarm in Winnipeg.

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After India lifted tariffs on yellow pea imports in December 2023, the country has become the top destination for Canadian yellow peas. From August through November, India bought no Canadian yellow peas, according to Statistics Canada trade data and the country has been a non-factor for Canadian yellow pea movement since tariffs were introduced in 2017. However, with the duties temporarily lifted, India imported 331,000 tonnes of yellow peas from Canada in December and January alone, which accounted for 66 per cent of all Canadian yellow pea exports during that period and vaulted India into the second spot behind China for total export demand this marketing year.

“Yellow pea imports are expected to help offset the anticipated shortfall in the supply of chana as the domestic crop is projected to be lower than that last year on a drop in acreage and weather impacting the yields,” said an unnamed Indian official in an Economic Times article accounting for the likelihood of extending duty-free yellow pea movement.

The initial move by the Indian government to allow duty-free yellow peas was to last until March but has already been extended into April in an effort to temper food inflation in the country ahead of elections happening in April/May. Pulse prices in India remain high, while the country’s own crops have been hampered by moisture concerns and an erratic monsoon.

Spot bids for yellow peas in Western Canada can currently be found as high as C$13.00 per bushel, according to Prairie Ag Hotwire data. That compares with prices that were topping out at C$11.50 in late-November before India entered the market.

— Phil Franz-Warkentin is an associate editor/analyst with MarketsFarm in Winnipeg. 

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Hamilton attributed the rise in prices to the reduced production of green peas plus a sudden demand for yellow peas from India and China to a lesser extent.

“A lot of the pea acres that went in this year were yellows. A lot fewer greens and poorer yields. The greens are in demand from our regular customers from South America,” he said, noting prices for the peas remained very good throughout harvest.

As for the yellow peas, Hamilton stated India in particular has essentially been non-existent as a buyer during the last four years.

“Then all of a sudden India announces they might have less [pulses] available. They drop their import regulations on yellow peas,” he commented, adding that prices for them went from “a soft $10 per bushel to $12.50 to $13.”

With that turnaround from India, Hamilton said if Canada produced an average yellow pea crop this year that would have slowed the spike in their prices. He said all of this buying will lead to tighter ending stocks for both peas, than what had been expected.

Statistics Canada issued its final production report for 2023 on Dec. 4, in which it placed total dry pea production at 2.61 million tonnes. While that’s up from StatCan’s September estimate of 2.27 million tonnes, it’s short of the 3.42 million harvested in 2022. Meanwhile, Agriculture and Agri-Food Canada isn’t expected to release its next supply and demand estimates until later this month.

Hamilton suggested farmers take advantage of the good prices for yellow peas by Dec. 31.

“Once Jan. 1 hits, the buying is going to be done,” he commented, with India unlikely to start another buying spree until what they have purchased now has arrived, which he believes would be March at the earliest.

Prairie Ag Hotwire reported green pea prices as Of Dec. 11 were C$16.50 to C$17.50/bu. delivered across Western Canada, with yellows at C$11 to C$12. During the course of 2023, green peas were as little as C$11.80/bu. to as much as C$18 and yellows ranged from C$8.20/bu. to C$13.39.

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“We are hearing that China slowed their imports down from Canada, which is driving the current decrease in prices,” Sargsyan said. “They have increased their imports from countries like Russia, which is increasing competition for our export market.”

He said yellow peas since April have fluctuated between $9.50-$11 per bushel free on board in Saskatchewan and Manitoba, adding that when export demand was strong, that pushed prices higher.

It’s the same story for green peas, as Sargsyan noted they have $16-$16.50/bu. f.o.b., being somewhat resilient as compared to yellow peas.

“The increased export competition will have an impact on long-term production. We will have to watch the geopolitical dynamics unfold to create long-term clarity,” he said.

The latest numbers from the Canadian Grain Commission listed pea exports 15 weeks into the 2023-24 marketing year were 760,500 tonnes, down slightly from 775,800 the same time last year. Domestic usage fell back as well, with 54,800 tonnes so far this year compared to 88,700 a year ago.

In terms of specific countries, the CGC cited total pea exports at 499,100 as of September. Of that 406,400 tonnes were shipped to China, which was more than the 342,300 tonnes a year ago. Canada’s other foreign purchasers in 2023-24 have been Bangladesh at 57,800 tonnes, Mexico at 25,000 and the United States at 9,900.

Prairie Ag Hotwire found that green peas across Western Canada were $16-$16.75/bu. f.o.b., slipping 50 cents over the last week. Meanwhile, yellow pea prices gave up $1.30 during the same time, at $10-$10.75/bu.

As for feed prices, they were unchanged at $9.75-$10.25/bu. f.o.b. in Saskatchewan and Manitoba, and $11-$11.70 delivered in Alberta.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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Sargsyan pointed out that prices for yellow peas have been slipping back recently.

“Export demand has dropped overseas, so that’s been pushing the yellow pea prices down. The market seems to be taking more yellow peas right now is the feed market,” he said.

Meanwhile, green peas have held steady or bumped a little as that market remained strong, Sargsyan added, noting it’s been around $13.50 per bushel picked up on the farm.

As of Monday, green peas added 25 cents/bu., according to Prairie Ag Hotwire. Prices in Western Canada have been $12.50-$13.50/bu. on the farm and $13-$14.50 delivered.

Yellow peas, on the other hand, have slipped back 20 cents/bu., with prices at $10-$11 picked up or $10-$12.80 delivered.

For the most part, feed prices on the Prairies continued to remain consistent for peas. Those in Saskatchewan and Manitoba haven’t changed, at $10-$11/bu. picked up in either province. As for delivered, Saskatchewan prices were $11.50-$12.70/bu., with no delivered price for Manitoba. Alberta saw its prices drop 68 cents/bu., with those delivered getting $12-$12.66.

With more processing plants to start up, Sargsyan said the future looks good for peas on the Prairies, especially for yellows.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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“The yellow pea market has some life again,” said Allan Johnston of Johnston’s Grain at Wellwyn, Sask. He added there were also a few companies chasing after some coverage for green peas with “lots of grain moving right now.”

Through the crop year-to-date, Canadian farmers delivered 1.92 million tonnes of peas into the commercial pipeline as of Feb. 19, up by 42 per cent from the same point the previous year.

Exports are also running well ahead of the year-ago, with the 1.29 million tonnes moved through the first 29 weeks of the 2022-23 crop year nearly double the 748,700 tonnes reported by the same time in 2021-22.

Green peas delivered to the elevator are currently trading at $12.50-$14.50 per bushel, according to Prairie Ag Hotwire data. Meanwhile, yellow bids can be found in the $11.50-$12.95 per bushel range.

Meanwhile, new-crop green pea bids top out at $11.75 per bushel, while yellow pea bids range anywhere from $9.50 to $12.50 per bushel.

— Phil Franz-Warkentin reports for MarketsFarm from Winnipeg.

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Besides the turning of the calendar New Year, Lechler said the upcoming Chinese New Year has slowed export demand for yellow and green peas. He noted celebrations go on for up to two and half weeks, which generates a lack of sales and in turn weighs on prices.

“Yellows were still at [$11 per bushel]. We were up as far as $11.25 in December. We were at $10.40 on the green peas, and we are down to $10.25 right now,” Lechler said (figures in US$ except where noted).

“A lot of the export market on pea stuff hinges on the Asian market,” he said, adding that domestic sales have weakened as well, due to slow movement around New Year’s.

“Domestically, we have seen a lot of the government sales pushed out toward March,” Lechler said.

As of Monday yellow pea prices in North Dakota dropped 25 cents/bu. over the last week and were sitting at $8.50 to $11, according to Prairie Ag Hotwire. Green peas garnered the same prices but have remained steady over the same period of time. Converted into Canadian dollars, that works out to C$11.38-$14.72/bu. for yellows and greens.

In comparison to western Canadian prices, Prairie Ag Hotwire said yellow peas were C$11.50-$12/bu., having dipped four Canadian cents on the week. Green peas on the other hand gained 20 Canadian cents and were sitting at C$13-$13.50 bu.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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