Canada Markets

Prices for dry edible peas on the prairies have pushed lower toward new-crop levels, as the yellow prices converge with the floor set by the feed pea market and greens grind lower from the lofty levels reached this spring. Saskatchewan pea bids released by Saskatchewan Agriculture as of Aug. 21 for product delivered to Saskatchewan plants indicate bids for feed peas at $7.11/bu, yellows at $7.28/bu and greens at $12.46/bu. Spot prairie bids reported to DTN indicate greens at $9 to $10, yellows at $6.75 to $7 and feed ranging from $6.50 to $7/mt, all FOB farm bids.

Harvest is underway on both sides of the border, with Manitoba's latest crop report suggesting yields are well above average and of excellent quality. Saskatchewan most recently pegged the average yield for peas between 27 and 40 bu/ac across the six crop regions of the province, with four of the six regions ranging between 35 and 40 bu/ac, which compares to the five-year average yield for the province of 32 bu/ac. Alberta's mid-month crop report rated peas at 89% good to excellent, while North Dakota's crop was 64% harvested as of Aug. 25, with the overall condition rated at 72% good to excellent.

The recent Canadian Grain Commission report Exports of Canadian Grain and Wheat Flour indicates 2012/13 exports for dry peas at 1.939 million metric tonnes, up 20.7% from the 1.606 mmt exported in 2011/12. Note that this data will exclude shipments through unlicensed facilities. Of this volume moved in the 2012/13 crop year, China imported 553,200 mt and India imported 953,900 mt. Combined, they purchased 76.7% of the total volume exported, which speaks loudly to the importance of these two markets.

The country of India has been in the news of late as it struggles with its currency, the rupee, which closed at a historic low against the United States dollar, which makes its imports more expensive. The rupee closed at a record low of 66.24 per USD in Tuesday's trade, as well as the largest drop in almost 18 years. The situation is complex, given that the threat of the United States government to "taper" or slow stimulus spending within the U.S. has had the impact of pulling money out of emerging economies and into the U.S. dollar. To make matters worse, the Indian government approved a $20 billion program today to provide food security to the poor in that country, a program which is suggested to impact 70% of the 1.2 billion population. Markets have indicated their concerns of the Indian government to control spending and deficits and this weighed further on the rupee exchange rate in today's trade.

Early movement of peas on the prairies is suggested to be slow off the combine and challenges may exist in this market may linger for a period of time.

Cliff Jamieson can be reached at cliff.jamieson@telventdtn.com

(ES)

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