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Pulses imports to fall hitting Canada, others

Pulses imports to India, the world’s biggest buyer, may fall to their lowest in almost two decades after the Centre raised import taxes and restricted overseas purchases to bolster prices, impacting the plans of its global suppliers.

The reduction in imports illustrates the government’s steps to raise the prices of pulses, like peas and lentils, to reduce payouts to farmers under its food subsidy scheme. Farmers in Canada, Australia and Russia that rely on Indian demand will likely intensify their cutbacks in pulses cultivation and continue to seek other markets in response.

India’s pulses imports could slide almost 80% to 1.2 million tonnes in the current fiscal, the lowest since 2000-01, Bimal Kothari, vice-chairman, Indian Pulses and Grains Association, told Reuters. “Quantitative restrictions and higher import tax are effectively restricting inflows from overseas,” Mr. Kothari said.

India has raised the import tax on some pulses to as high as 50% and fixed quotas for others like yellow peas, green gram and chickpeas. The country imported 5.68 million tonnes of pulses worth $3 billion in 2017-18, down 15% from a year earlier, but up from just 3,50,000 tonnes in 2000-01, according to data from the Ministry of Commerce.

Exporters scramble

Record Indian pulses imports of 6.6 million tonnes in 2016-17 prompted Canadian and Australian farmers to expand pulses cultivation but the contraction in imports in the past year has reversed that. Farmers in Canada, India’s biggest pulses supplier, have slashed lentil cultivation by 14.5% and peas by 12% in 2018, according to Statistics Canada.

Canadian exporters are shipping more peas and other legumes to China, which uses them as an alternative to soymeal for pig feed after imposing higher tariffs on soybeans from the U.S.

Australian suppliers are not anticipating a quick rebound in Indian demand and are trying to ship more to other Asian and West Asian countries. “We are unlikely to see India return as a buyer… until sometime in 2019,” said Rob Brealey, pulses trader at COFCO International in Brisbane.

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