India keeps door open for pea sales

India is extending its duty-free pea import window by one month.

Exporters now have until April 30, 2024, to get product into the country without having to pay an import tax, up from the original deadline of March 31.

The policy already had an enormous impact prior to the extension.

“Indian pea imports have caused a storm in the world pulses markets,” Gaurav Jain, analyst with AgPulse Analytica, said in an email.

“Prices of nearly all types of pulses are affected and at all origins.”

Vivek Agrawal, director of JLV Agro, an Indian commodity brokerage firm, is forecasting that India will import 1.8 million tonnes of peas in 2024.

That would be a huge new source of demand for yellow peas, given that India has been out of the market for about seven years.

Jain believes India will import one million tonnes of peas by March 31 and another one million tonnes after that.

“As per our understanding, this will empty out the inventories of all major origins, including Russia,” he said.

India first imposed a 50 percent duty on peas in November 2017. That was followed in early 2018 by a series of other restrictions.

Import volumes were limited to 150,000 tonnes annually. The minimum price on imports was set at 200 rupees per kilogram, or approximately US$2,400 per tonne. And imports were restricted to the Port of Kolkata.

The policy measures effectively blocked any pea trade with the country. However, with all those constraints now lifted, peas are flooding into the market.

So why did India extend the exemption by one month?

Jain thinks the government is taking a pre-emptive decision while there are still enough peas to fill the gap in India.

Agrawal stated in a WhatsApp message that the government is concerned about the pigeon pea crop harvested last fall and the chickpea crop that will come off the fields in March/April.

He said the government is forecasting that the chickpea crop could be 15 percent smaller than originally anticipated.

Yellow peas can be used as a substitute for Indian desi chickpeas in some dishes.

Jain is forecasting 10.5 million tonnes of Indian chickpea production, down 13 percent from last year, but it could get worse if conditions further deteriorate.

Agrawal said most of the yellow pea imports will come from Canada and Russia, but he doesn’t know what the breakdown will be.

He thinks the 2024 buying spree will be an anomaly unless big production problems surface again as the year progresses.

Jain said this is an election year in India and the government wants to ensure it has an adequate supply of pulses to make up for its poor pigeon pea crop.

He agrees that this is probably a one-off type of year.

“India is unlikely to remain open for pea imports, as the government aims for self-sufficiency in pulses by 2027,” said Jain.

“An open import of cheap peas will disincentivize farmers to plant pulses.”

He thinks Black Sea farmers will allocate more land to peas this year due to what will likely be tight global pea stocks at the end of 2023-24.

Tags: импорт, India, pea, tax, demand, duty-free, yellow peas, зrices