PULSE MARKET UPDATE - February 2024

Welcome to the February edition of the PGRO Pulse Market Update. For the first time we are offering the opportunity to listen to this month's update on our podcast Inside the Pod, which you can listen to here. Or, you can read on below for the full market update.

Commentary

Since the start of the new year, trade has continued at a lower level than that experienced before Christmas.
There is still demand for pulses in the domestic markets which sellers continue to meet. Trade however is steady rather than exciting at present.
Given the generally falling values for other crop commodities, pulses have held their pre-Christmas levels remarkably well with a significantly wider gap over wheat and other feed alternatives to which they are routinely compared.
Export demand to the EU has been dampened on the back of these higher values. Increased use of pulses in markets such as Germany and France may have initially focussed attention on their home- produced product.
The Australian harvest of beans is arriving in ports to meet the human consumption demand of the traditional takers but combined with high GBP values relative to the US$, global conflicts, local economic difficulties and associated risks in payment continue to dominate the markets of Egypt, Sudan and the Arabic crescent. The UK crop of 2023 was generally of inferior quality in comparison, and is therefore finding it almost impossible to compete at this time of year. However, the war in Gaza and the spin-off issues of delay and increased costs for cargo diversions around the Red Sea, have opened up the opportunity for some smaller cargos of feed grade beans to be exported for “cleaning” in markets of destination.

The availability of peas via Poland from Ukraine are putting a lower base in the feed pea market.

Questions are being asked about the likely crop area for 2024. Peas appear to be attracting some significant attention and contract area is progressing nicely. While there are still contracts available for most pea types, seed availability will soon become an issue, so the advice to anyone considering peas is to contact your merchant to secure your contract sooner rather than later

The proportion of winter beans sown is uncertain. Attached to this report is a link for advice for those seeking to sow winter beans in the spring. With land drying out considerably, many will be targeting drilling as soon as practical in February, when the soil is in suitable condition.

SFI payments to take land out of production may attract interest, and are seen as a potentially significant threat to spring crop area sown to alternative crops such as pulses. Consideration must surely be given to the potential costs of bringing the land back into production against the many benefits to be gained from maintaining pulses within the rotation and continued cash crop production. With still significant uncertainty, new crop bean trading has yet to begin.

UK Pulses

Feed Beans
Demand since harvest has been good to date in all feed sectors. Figures suggest that domestic use in compound feed has been stronger to date than at any time in the past. Whether this is a structural change will not be clear until the end of the crop year, as while buyers secured their needs prior to the year-end, many have not yet covered the remainder of the season and are faced with falling commodity values for almost all alternative protein sources. Bean values are believed to have been maintained in the face of these pressures on the back of short sellers and those who are not able or willing to move beans out of their portfolio of ingredients.
Export interest in the EU still exists but at present there are few buying decisions being made indicating prices are high. Whether values of around £240-245/t ex farm can be sustained is in question, and may indicate a slide to come. They currently represent a spot premium over wheat of about £80/tonne depending upon location.

Human consumption bean exports
There is almost no activity in this market at present. If a grower has good quality beans suitable for this market, they are advised to contact their local buyer for any available premium over feed.

UK combining peas
Pea trades in recent weeks have been few and far between. Values have slid slightly but remain largely static although little of good/ excellent quality has come forward for traders to consider recently.
Poor samples of peas destined for animal feed will trade at a discount to feed beans and compete with low priced offers for imports.
A few contracts are available for most types of peas but seed may be a restricting issue for first choices.

Green peas
New offers for good quality old crop ex farm are few and far between. Offers might be anticipated between £310- £345/t ex farm for better quality samples depending upon location.
Contracts for spring sowing 2024 are still available. Minimum Maximum £300 - £400/t ex farm with various optional clauses. Contact your merchant for varietal choice.

Marrowfat peas
Few if any off contract offers from sellers. Values have fallen slightly nominally £530 - £550/t ex farm depending upon quality.
Contracting for 2024 crop has still some availability at £500/t ex farm depending upon seed availability.

Yellow peas
There is uncertainty in this market, despite being the most flexible in terms of marketing opportunity it is the sector most subject to the influence of imports.Current values may be up to £320/t ex farm. Contracts for crop 2024 are still available but are limited and likely to have similar values.

Maple peas
After months without interest or apparent availability buyers have returned and product which is not available is in demand.
Variety Rose is preferred for human consumption export buyers and Mantara for pigeon and other bird feed specialists
There are new contract opportunities for crop 2024 at up to £430/t ex farm subject to buyers terms.