Market Insights: India's Rising Pulse Production and Global Market Implications

India Forecasts Higher Pulses Production; Turkey's Lentil Crop Seen Higher

The latest production data for pulses from India and Turkey signals potential pressure on global markets. With India reporting higher coverage of the summer or Zaid crop, prices could remain constrained until June.

According to India's Ministry of Agriculture and Farmers' Welfare, pulses production during the kharif and rabi seasons of the current crop year (ending June) is estimated at 23.02 million tonnes (MT), an increase from 22.17 MT in the previous year.

Desi Chickpeas Showing Recovery

Desi chickpeas, a winter or rabi crop, are expected to recover this year to 11.5 MT compared to 11.03 MT last year. Current prices in India are at ₹54,630 per tonne, just above the government's minimum support price (MSP) of ₹54,400. In the global market, Australia is offering desi chickpeas to India for April-March delivery at $705 per tonne.

Desi chickpeas have experienced a sharp price decline over recent weeks. This trend could reverse if India decides to halt duty-free imports and procure stocks from farmers at MSP.

Other Pulse Varieties Also Seeing Increases

While releasing the rabi crop estimates, the Indian government has raised production figures for several other pulse varieties:

• Pigeon Peas (Tur): Production estimate increased to 3.51 MT compared to the 3.501 MT projection from November. Current prices are at ₹69,330 per tonne against the MSP of ₹75,500. Myanmar's Lemon variety is being offered to India at $820 per tonne.
• Black Matpe (Urad): Total production estimated at 1.79 MT, with kharif output increased to 1.28 MT from the previous 1.25 MT estimate. Rabi production is estimated at 0.517 MT. Current prices stand at ₹72,100 per tonne against the MSP of ₹74,000. Myanmar is offering April delivery at $815 per tonne, while Brazil's offer is at $960 per tonne.
• Lentils (Masur): Production forecast at 1.82 MT. Current prices in India are at ₹59,250 per tonne compared to the MSP of ₹64,250. In global markets, Canadian red lentils for April delivery are quoted at $715 per tonne, while Australian lentils are priced at $675 per tonne for delivery to India.
• Mung Bean (Green Gram): Production projected at 1.60 MT, with kharif output raised to 1.5 MT from 1.38 MT. The rabi crop is estimated at 0.107 MT. Current prices are at ₹72,100 per tonne against the significantly higher MSP of ₹86,820. Russia is offering green lentils to India at $945 per tonne, while Canada's price for April delivery is $1,115 per tonne.

Turkey's Lentil Production Set to Increase

Meanwhile, Turkey's lentil crop is expected to recover following recent rainfall. Production is forecasted to increase by at least 10% from last year's 405,000 tonnes. The harvest is scheduled for June, potentially bringing additional supply to global markets.

Conclusion

The projected increase in India's pulse production across multiple varieties, coupled with Turkey's anticipated higher lentil crop, points to a potentially well-supplied global pulse market through mid-2024. For importers and processors, this forecast suggests favorable procurement conditions, though prices could stabilize if India adjusts its import policies or increases domestic procurement at MSP levels.

Traders should monitor India's policy decisions closely, as changes to duty-free import provisions could quickly alter market dynamics. Additionally, the actual yield of Turkey's lentil crop following the June harvest will be a key indicator for pricing trends in the second half of the year. These developments underscore the importance of data-driven decision-making in navigating the complex global pulse trade landscape.