Better-than-expected lentil crop faces market volatility

CNS Canada –– Despite a summer of excess moisture across much of the Prairies, lentils fared better than earlier expectations, according to Bobby Leavins, operations manager for Rayglen Commodities in Saskatoon.

However, the crop’s grade spread is still very wide and prices are expected to be wide-ranging over the winter.

“With all the moisture a lot of guys were scared, but we’ve seen a fair amount of No. 2 good quality,” he said, noting the outlook for lentils back in early September was less rosy.

A few farmers still haven’t managed to get their crops off yet, but Leavins estimated 99 per cent is now in the bin.

“You’ve got all kinds of grades, all kinds of prices, he said, with averages “anywhere from 20 to 40 cents (per pound) depending on quality.”

Red lentils are priced anywhere from 16 to 30 cents per pound, said Leavins, while green lentils are slightly higher, with some crops into the 40-cent range.

Demand for Canada’s lentils will come from all over, he said. Traditionally, he added, India is one of the biggest importers of Canadian lentils but it’s hard to predict what that country will do.

“Anyone that knows exactly what India’s going to do, or anyplace over there, I don’t know who they are and I’ve never met them,” he said, noting monsoons, huge domestic demand and complex policies added to the uncertainty.

Statistics Canada estimated the country’s 2014 lentil crop at 1.93 million tonnes, up from 1.88 million tonnes last year.

Going forward, Leavins expected Canadian lentil stocks on July 31 to be quite low.

“We won’t carry much good-quality peas or lentils into next year,” he said. “It’s a volatile year.”

— Dave Sims writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.