Global Economic Outlook for Chickpea & Dry Bean

By Brian Clancey, STAT Publishing
October 2022

Chickpeas

International markets for Kabuli chickpeas and the types of dry edible beans grown in Canada are entering another year with relatively tight supplies, suggesting they could outperform pulses in general during the coming marketing season.

A key reason is that while yields are up significantly over last year in both Canada and the United States (U.S.), land in beans declined because of competition for land use from grains and oilseeds. This had a modest impact on interest in growing chickpeas in the U.S., but not in Canada. Reduced plantings in the U.S. were partly offset by gains in seeded area in Canada.

The reasons for reduced interest in planting beans and other pulses reflects the strength of grain and oilseed markets during the past season. Looking at price indices for those markets, all were above their previous three-year average during the 2021/22 marketing year. But the increases were bigger for grains and oilseeds than pulses.

Combined with weather problems in countries such as Mexico, North America may not have produced enough beans and chickpeas to meet both export and domestic needs, with the result markets are expected to be more focused on North American domestic markets than pursuing export opportunities in other parts of the world.

The problem is most acute in chickpeas. Mexico’s harvest was disappointing and while production in Canada and the U.S. are up significantly from last year, the region may have difficulty meetings its domestic needs.

Last year’s drought had a major impact on available supplies of chickpeas in North America. Domestic disappearance in the two countries dropped from an estimated 264,100 tonnes in 2020/21 to 221,600 last season. It is expected to advance to 280,700 tonnes during the 2022/23 marketing campaign, but disappearance remains below the levels seen in 2019/20, when they reached and estimated 391,100 tonnes.

Estimates by STAT based data from the FAO, USDA, StatCan, ABARES, and other entities

Canada and the U.S. are important trading partners for chickpeas. The U.S. emerged as Canada’s second most important market after Pakistan last season; while Canada was the second most important market for the U.S., also after Pakistan. Bilateral trade likely includes export movement by both processors and farmers.

Interestingly, though production is up over last year, the available supply of chickpeas is expected to lower based on the latest production estimates from Statistics Canada and the United States Department of Agriculture (USDA). The implication is exports will likely be lower than last season, with Canadian movement possibly dropping from almost 179,300 tonnes to around 149,800; while U.S. exports may be unchanged at a forecast 59,600.

One of the issues facing the two countries through next spring is the fact output in Mexico has been disappointing. Production in the U.S. has shifted strongly toward small caliber varieties because of the needs of hummus manufacturers. As a result, domestic supplies of large caliber chickpeas have been reducing, contributing to import demand from Mexico and Canada.

The bottom line for growers is markets should remain relatively firm until we get a better picture of next year’s chickpea harvests in India and Mexico. Given current values, production ought to increase, resulting in stiff competition for available demand in other parts of the world. Though India is a net importer of pulses, its chickpea exports could end up around 305,000 tonnes during the 2022 calendar year, up from just 95,000 last year and 176,000 tonnes in 2020, underscoring its potential influence on international values in 2023.

Beans

Similar to chickpeas, North American dry edible bean markets may be more focused on domestic needs as opposed to potential export demand in other parts of the world. Land in beans was expected to be up over last year, but wet conditions delayed seeding in some key production areas, with the result white bean plantings in both Canada and the U.S. dropped from 393,000 to 294,000 acres, while coloured bean area fell from 1.502 million to 1.331 million.

Average yields are up over last year. Even so, combined white bean production in Canada and the U.S. will drop from 339,000 to 280,000 tonnes based on initial estimates from the USDA and StatCan. On the other hand, coloured bean output in the two countries should advance from 1.116 to 1.176 million tonnes.

Carry overs from the 2021-22 marketing year are relatively high, suggesting the available supply of white beans will slip from 497,000 to 462,000 tonnes, while coloured beans advance from 1.34 to 1.405 million tonnes. Overall disappearance is expected to be good and next summer’s residual supplies of both groups of beans should be down from this year.

Canada’s dry edible bean crop will again be dominated by navy or white pea beans. Most of the production is in Eastern Canada and Manitoba. The second most widely grown class is pinto bean, with most of the production located in Manitoba, followed by Alberta and Saskatchewan. Black beans are the third most important class produced, with Manitoba producing most of the crop, followed by Ontario and Alberta.

There is considerable movement of dry edible beans between the two countries. Canada imported around 14,000 tonnes of navy beans from the U.S. last season, but in the last three marketing years has exported around 100,000 tonnes of all classes of beans to the U.S., making it the most important destination. Despite the free trade agreement between Canada, U.S., and Mexico, Canada ships limited quantities of beans to Mexico, instead focusing on destinations such as the United Kingdom.

In recent decades, world trade in dry edible beans has seen many changes. China was once a dominating exporter of beans similar to those grown in Canada and the U.S., but farmers have been shifting land into corn and soybeans, reducing its impact on global trade and prices. Argentina remains a major producer, but it focuses on Brazil for black beans and those European destinations which consume large caliber white alubia beans. More competition has been coming from Africa, supported by regional and European demand as well as efforts by India to expand sources of supply for varieties not grown here.

Given the supply outlook for Canada and the U.S., it seems likely exports to countries in other parts of the world will decline, while trade within North American should remain strong, with more of a domestic focus.

Mexico’s crop is expected to disappoint, which would be expected to result in more demand for U.S. origin beans, with Canada likely maintaining export volumes to the U.S. Demand in the U.S. for coloured beans should remain relatively strong. A key factor is that while available supplies of all classes of beans in the U.S. are up over last year, domestic usage and exports may rise to levels which result in a reduction in next summer’s ending stocks.

The net result is prices for dry edible beans are expected to be fairly well supported across the coming marketing season, with movement likely at levels that makes it easier to sell what you grew.

Based On StatCan and provincial data

BASED on data from StatCan and USDA

Note: 2014-2016 equals 100

Brian Clancey is the Editor and Publisher of www.statpub.com market news website and President of STAT Publishing Ltd. He can be reached at editor@statpub.com.