FAO/GIEWS - Food Outlook No.3 - June 1999 p. 5

PULSES1/

Total world production of pulses in 1999 is expected to rise slightly, to a record 58.5 million tonnes, up about 1 million tonnes from 1998. This assumes adequate summer rainfall in Asia and North America, where plantings are expected to expand. Farmers in the United States were expected to increase pulse plantings significantly in 1999 because of very low prices for maize and soybeans. However, the final area may not be as large as anticipated because dry bean and pea prices also weakened during the planting period. Canadian farmers planted more beans, lentils, and chickpeas for the 1999 harvest, partly because of more favourable price prospects compared to most other crops. India is by far the world's leading producer of pulses. In India, if normal rainfall prevails, the 1999 harvest may surpass the good 1998 output of about 15.6 million tonnes. Production in Bangladesh is expected to recover sharply following flood damage in 1998. Elsewhere, pulse production in 1999 in most Mediterranean countries is forecast to be below the 1996-98 average and severe drought this year has reduced yields in the Near East, especially in Turkey and Syria.

WORLD PULSES PRODUCTION

World imports of pulses in 1999 are likely to rise slightly from the previous year to about 7.8 million tonnes. World imports of pulses for direct food consumption are expected to increase in 1999, but imports of feed beans are forecast to decline. During 1999, India is likely to remain the world's leading importer of pulses, with imports of over 740 000 tonnes. Rising disposable incomes and improved marketing systems and declining per capita production are spurring Indian import demand. Pulse imports by Bangladesh are also expected to remain high in 1999, after rising sharply in 1998 because of flood damage to local crops and food supplies in storage. Pakistan normally imports over 150 000 tonnes of pulses annually, but purchases are forecast to increase in 1999. Lower prices are expected to contribute to increased imports of dry beans by some countries in North Africa, in addition to increased food aid shipments, especially to tropical Africa. In several other importing countries, such as Spain, Italy, Cuba, Albania, Iraq, Egypt, Algeria, and South Africa, imports of pulses are expected to rise in 1999 mostly due to lower prices.

WORLD PULSES IMPORTS

Turning to exports, Canada, the leading world exporter of pulses, is expected to increase its shipments in 1999 to a level near the peak of 1.5 million tonnes recorded in 1995. In recent years, Canada has expanded its markets in Africa, Asia and Latin America. Canada is also likely to be an important donor of beans and peas as food aid. France is usually the second leading world exporter of pulses, but most of its shipments, mostly peas, are destined to other EC countries. Outside the EC and besides Canada, the leading world exporters of pulses are Australia, Myanmar, China and the United States. Myanmar has enjoyed a boom in exports of pulses in 1998, exporting about 800 000 tonnes mostly to South Asia, and exports could increase further in 1999. After Myanmar, Australia has traditionally been the second major supplier of pulses to South Asia. Australian total pulse exports are also tentatively forecast to increase in 1999 to almost 1 million tonnes, from 830 000 in the previous year. Although China's bean exports to some Asia markets like Indonesia are expected to remain low in 1999, it's exports of kidney beans to Cuba may increase further and total exports could be above 1998. Dry bean exports from the United States increased by 38 percent in 1998 to about 483 000 tonnes. Most of the 1998 increase stemmed from larger sales to Mexico. However, a steep decline in exports to Mexico is expected in 1999, mostly because of an improved domestic bean crop.

WORLD PULSES EXPORTS

A mixed picture emerges for the global pulse price prospects for 1999. It should be noted that because substitution among the different types of pulses is limited, prices tend to vary substantially between various types of pulses, and could even move in different directions. In May 1999, prices for some types of beans in North America were at their lowest level since 1992, due mostly to a lack of expected purchases by Mexico. By May 1999, the average price for US pinto beans fell to US$400 per tonne, a third below a year earlier. Similarly, US black bean prices also declined from the high of around US$860 per tonne last year to US$539 per tonne in May 1999. While slowness in sales of black beans to Brazil, mostly due to a weak currency, caused Argentine export prices to fall below US$480 per tonne, a faster recovery in Brazil's economy and larger import demand from some other countries in Latin America could prove supportive to prices in the remainder of 1999. Prices for Michigan's navy pea beans were quoted at nearly US$705 per tonne in May 1999, up substantially from US$424 per tonne registered a year earlier. Export prices for these types of beans are expected to remain firm following large sales to Europe, which resulted in a significant reduction in US stocks. In the dry peas market, which is mostly a feed market, prices have continued to slide over the past two years, and large export availability, especially in Canada, is expected to keep prices below the average levels also in 1999. Recent recovery in lentil prices, particularly of Canadian origin, is expected to accelerate further in the coming months because of reduced export supplies from the other major exporters, namely Syria and Turkey due to lower production. Similarly, export prices of chickpeas are also likely to be firm in 1999 due to the drought in the Near East and, especially, the likely decline in Turkey's output, the world second largest exporter after Australia.