Global Economic Outlook for Chickpeas & Dry Beans

By Brian Clancey, STAT Publishing
October 2024

When people think of countries that influence demand in pulse markets, they often think of India and possibly China. However, Mexico is now having a profound impact on both dry edible beans and Kabuli chickpea markets.

Poor growing conditions in Mexico resulted in significant declines in field crop yields last year, and in some regions this year. More recently, heavy rainfall has damaged developing crops in parts of the country.

Dry Beans

For farmers in Canada and the United States (U.S.), the most obvious effect has been a solid increase in sales of coloured beans to Mexico. Shipments to Mexico from the U.S. during the 2023/24 marketing year have more than doubled to around 220,000 tonnes, while Canadian shipments pushed past 30,000 tonnes.

U.S. export data reveals 36% of all beans shipped to Mexico were declared as pinto, 25% as black, and 33% as kidney-type beans. The latter would include black and pinto that were declared using the Harmonized System (HS) code for generic kidney-type beans.

Most processors and exporters are optimistic Mexico will continue to import good volumes of beans until early in 2025. This is reflected in continued strength in prices offered to Canadian growers for coloured beans by shippers covering short-term shipping commitments to both Mexico and the U.S.

Markets need demand from Mexico to remain strong for as long as possible during the current marketing year. Though dry edible bean production in Canada is little changed from last year’s estimated 393,600 tonnes, initial yield estimates suggest output in the U.S. has jumped from 1.14 to 1.5 million tonnes.

The biggest increase is expected to be in pinto beans, with the U.S. harvest jumping from 390,400 tonnes to a forecast 608,700 tonnes based on the normal relationship between yields for each class and the average for each state. The United States Department of Agriculture (USDA) will break down production by class in its final production report in January.

Canadian pinto bean production is expected to increase at a more moderate pace, possibly from around 107,500 tonnes last year to 117,000 tonnes this year, with Saskatchewan accounting for around a fifth of the harvest. Manitoba is the largest producer of coloured beans in Canada, accounting for over half the harvest, while Ontario is the dominates Canada’s navy or pea bean harvest.

To the extent growers in Saskatchewan take advantage of opening season market strength, they will avoid the risk that values could be lower on average after December.

The U.S. finished its 2023/24 marketing year with more pinto beans on hand than initially thought. A survey of processors in the state suggests the 60,000 tonnes of pinto beans were carried over into the current marketing year. If production comes in at 608,700 tonnes, available supplies of domestically grown pinto beans could jump from 542,400 tonnes to 668,700 tonnes.

The implication is that U.S. imports of pinto beans from Canada could be lower this season, while competition for the attention of buyers in Mexico will be more intense.

Not just from the U.S., but from exporters in Argentina and Brazil, both of whom would like to see black bean shipments to Mexico increase further. During the first half of the 2024 calendar year, Brazil shipped 14,150 tonnes of kidney beans to Mexico and 5,400 tonnes to Argentina.

Mexican importers have clearly demonstrated their capacity and willingness to cover needs from outside the North American free trade zone, which creates the potential for asking prices from those origins to influence how much buyers are willing to pay for Canadian- or U.S.- origin product.

Chickpeas

Issues in Mexico which affected import demand for dry edible beans are the same as those which have affected its capacity to export Kabuli-type chickpeas and the recent escalation in its asking prices.

So far during the 2024/25 marketing year, asking prices for 11 mm Kabuli chickpeas from Mexico have averaged U.S. $1,675 per tonne, up from the 2023/24 season average of $1,450 per tonne. The record-high price for 11 mm chickpeas from Mexico is $2,050 per tonne. That was set between May and September of 2017.

Markets for 9 mm through 11 mm Kabuli chickpeas are also being helped by reduced shipments from India. During the first half of the calendar year, India exported 98,300 tonnes of Kabuli chickpeas, down from 129,000 tonnes during the same period in 2023 but above the previous five-year average of 76,700 tonnes.

The reduction reflects a smaller harvest from this year’s rabi season harvest. Total chickpea output sank from 12.27 million tonnes to 11.58 million tonnes according to India’s third estimate of 2023/24 pulse production.

The split between desi and Kabuli output is not broken down by the government, but the decline in export activity suggests Kabuli output was also down. India’s emphasis on increasing domestic pulse output may not have much impact on export-oriented Kabuli chickpea production. Returns from the crop are strong relative to grains and oilseeds, which would be expected to support interest in the crop in India and other origins.

It is important to note that Russia has become a powerful competitor in small-caliber Kabuli chickpea markets. Russia’s asking prices for 7 mm chickpeas on the Indian subcontinent are highly competitive and would be expected to continue to limit demand for Canadian-origin product.

For instance, between January and November of 2023, Pakistan imported 17,300 tonnes of chickpeas from Canada and 137,000 tonnes from Russia. Australia remained the dominant supplier to the country. However, Australia ships desi type while Canada and Russia mainly ship small- or medium-caliber Kabuli types.

Initial yield estimates for Canada suggest this year’s harvest will each 327,200 tonnes, well above the 172,500 tonnes harvested last year and the previous five-year average of 175,100 tonnes. Though desi plantings are increasing, output is still inconsequential relative to Kabuli.

Given the initial slow pace at which product appears to be moving from growers into the hands of processors and exporters, the demand outlook for November through March becomes more critical. That also focuses attention on what might be grown in India and if growing conditions in Mexico encourage increased output there.

Not surprisingly, there is uncertainty about how prices are likely to evolve and what kind of competitive pressures exporters may face. It already seems likely farmers will carry a lot more chickpeas into the coming marketing year than was the case last July.

If Canada can expend exports by 60,000 tonnes, the season would likely end with a carry over 72,000 tonnes. But, if competition limits exports to the same level as last season, the carryover could push past 130,000 tonnes. The obvious risk is that as strong as markets are at the moment, prices in Canada could begin to feel the weight of unsold stocks after March, possibly resulting in a downward trend.

In great measure, the situation in Mexico will remain a powerful influence on North American dry edible bean and chickpea markets. Not simply because of its regional impact, but because of its impact on global trading levels and the resulting decisions of farmers in other countries.

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.

Based on data from USDA, Statistics Canada with projections by class for the U.S. STAT

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.