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Informist, Thursday, Nov. 14, 2024

 

MUMBAI/NEW DELHI – Production of kharif pulses in India is expected to be 8 million tonnes in 2024-25 (Jul-Jun), exceeding initial government estimates by at least 1 million tonnes, according to economist and agricultural policy expert G. Chandrashekhar. This optimistic outlook was unanimously shared by all panellists during a discussion on production outlook for kharif pulses, held by the India Pulses and Grains Association, on Thursday.

 

The government has estimated the total production of kharif pulses to be 6.95 million tonnes, down marginally from 6.97 million tonnes produced in the kharif season of 2023-24 (Jul-Jun). 

 

The discrepancy in numbers is primarily attributed to a significant difference in tur production estimates. While the government projects tur production to be 3.50 million tonnes, the industry estimates it at a substantially higher 3.70 million tonnes, potentially reaching four million tonnes.

 

Similarly, the government's initial estimate for kharif urad production at 1.29 million tonnes is likely an underestimation, according to the panellists. The final kharif estimate may see a significant revision upwards, potentially adding 200,000-300,000 tonnes, Chandrashekhar said. 

 

Moreover, with the overall production scenario looking upbeat due to a good monsoon, the industry estimates production of moong and other pulses to be higher as well.

 

TUR CONUNDRUM

 

The overall weather and conducive monsoon have instilled a positive sentiment in tur traders who see a considerable rise in production, despite prolonged rainfall that extended to the month of October. 

 

However, imports, too, are likely to rise on increasing demand. "Despite a rise in production, we estimate imports to rise by 7% on year, touching almost 1 million tonnes in 2024-25 (Apr-Mar) on rising demand. However, we see imports falling next year onwards to 800,000 tonnes due to rising acreage and production," Kunal Parakh, owner of Full Circle Commodities, a global brokerage house, said at the webinar. India consumes about 4.50 million tonnes of tur per year.

 

Traders also see prices of the essential commodity sliding to touch the minimum support price of INR 7,550 per 100 kg by Jan. 25 on higher supply as the domestic crop starts coming to the market in January. "However, in the near term, we see current prices sustaining on the delayed harvest," Parakh said. 

 

CHANA SCENARIO

 

Chana crop, the production of which fell 10% on year to 11.04 million tonnes last year, is likely to see an uptick, according to the traders. "We see chana acreage rising by anywhere between 5-10% on higher realisation, good monsoon," Satish Upadhyaya, vice-chairman of India Pulses and Grains Associations said.

 

Meanwhile, chana prices have fallen 11% in the past two months on ample imports of cheaper chana as well as yellow peas. According to traders, almost 2.50 million tonnes of yellow peas have been imported so far in 2024-25 (Jan-Dec). They see the number rising to 3 million tonnes by the end of December. Yellow peas are a cheaper alternative to chana, used for making besan. 

 

The sales of Bharat Dal are also bringing chana prices under pressure as consumers prefer the cheaper option, Upadhyaya said. 

 

However, factors which can support prices include low stocks with traders, too low stocks with the government to intervene in the market significantly, and delayed chana sowing which is almost a month behind due to extended rains, he said. Moreover, the upcoming Ramadan festivities and the marriage season are both likely to increase demand and bolster prices. 

 

Prices of chana in the near term will also depend on the prices of Australian chana imports, which have dropped 25% since June this year to $685 per tonne. Chana imports, which are currently duty-free until March 31, 2025, may continue to enjoy zero duties in the next financial year as well, if sowing levels remain lower than the previous year, Upadhayaya said. 

 

URAD OUTLOOK

 

The first kharif estimates of urad production, which stood at 1.29 million tonnes, were "much lesser than expected", Rajesh Agarwal, executive member of Premier Pulses, said. Around 10-15% of the crop faced damage due to the excess rains, bringing numbers down. The late arrival of the southwest monsoon also limited the sowing period for the pulse, bringing output down, he said.

 

Even with an estimated output of 1.69 million tonnes of urad for the year, which includes rabi production, the country would experience a shortfall in supply, Agarwal said.

 

However, India will make up for the shortfall with imports from countries such as Myanmar. Monthly imports from Myanmar average 70,000 tonnes, and as of September, the country has already imported 400,000 tonnes of urad since April. "Cultivation of the new crop in Myanmar is expected to rise 10-15% this year, with an estimated total production of 1 million tonnes," he said. Reports of good production in Myanmar have already brought down prices of urad in the country in the past 10–15 days, he said. India can receive the new Myanmar urad imports by the first or second week of February, he said. Brazil is also emerging as a major urad exporter to the country, with 6,000-7,000 tonnes projected to arrive in the country in the next few months, he said.

 

The different crop cycles of urad in various states of the country also make the pulse available around the year, he said. "In Maharashtra, the crop cycle is 60–65 days, in Madhya Pradesh it is 70–75 days and in Rajasthan it is 90 days," he explained. As such, the country will not face any shortages in urad. Prices are also not expected to increase, with continuous imports coming in, he said.

 

MASUR QUESTION

 

The demand for masur is on the rise, especially since 10-15% of the country’s masur is used as a cheaper substitute for tur, Harsha Rai, global sales head at Mayur Global Corp., a foodgrains trading company, said. "The rabi acreage of masur is estimated to be the same as last year," she said. 

 

Last year, the country produced 1.79 million tonnes masur. In the current rabi season, farmers in Madhya Pradesh could be more inclined to grow wheat and chana over masur due to the attractive prices of wheat, and in fear of the disease which plagued the masur crop in the state last year, according to Rai. "On the other hand, masur seeding is expected to go up in the major producing state of Uttar Pradesh," she said.

 

India imported a total of 1.68 million tonnes of masur in the previous year, all of which was consumed domestically, she mentioned. However, since April, the country's masur imports have declined significantly, with only 369,078.06 tonnes imported, representing a 40% drop compared to the same period last year.

 

The future outlook on the prices of masur will depend on when the government will offload its stocks, and at what prices, she said.

 

 

SIGNIFICANT CHALLENGES

 

The panellists concluded that the growth of pulses in India faces significant challenges, particularly land constraints and adverse effects of climate change, which pulses are highly vulnerable to. "To address the declining production trend, which has been sliding for the past three consecutive years, India must intensify its efforts to boost production and reduce reliance on imports," policy expert G. Chandrashekhar said.

 

The country has witnessed a successive decline of 1 million tonnes in pulse production over the last three years, from 27.3 million tonnes in 2021-22, to 26 million tonnes in 2022-23, and further down to 24.3 million tonnes in 2023-24, due to land constraints, water scarcity, and weather-related issues. This downward trend, coupled with increasing demand, has resulted in a double whammy, leading to market volatility due to demand-supply mismatch, he said. End

 

 

Reported by Pallavi Singhal and Shreya Shetty

Edited by Deepshikha Bhardwaj

 

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