AgCanada Sees Tighter Lentil Outlook
WINNIPEG Jul 27/16 - SNS -- In its latest monthly review of Canadian lentils Agriculture Canada's market analysis branch in Winnipeg updated its supply and demand forecasts for 2015. Area was updated to reflect this year's seeded area estimates from Statistics Canada. Production forecasts are not based on surveys and are not official forecasts.
Bobby Morgan, Pulse and Special Crop Analyst, predicts lentil production this year will reach 2.2 million MT from 3.87 million acres, compared to 1.837 million MT from 3.13 million acres in 2014. However, in releasing the numbers, Agriculture Canada said they will likely be revised lower in August.
Agriculture Canada expects exports to reach 1.8 million MT in 2015-16, compared to 1.8 million MT in 2014-15 and 1.76 million MT last season. Domestic use is forecast at 310,000 MT next season versus 316,000 MT this season and 565,000 last season.
Season ending stocks are forecast to finish the 2015-16 marketing year at 150,000 MT, versus 50,000 this season and 164,000 MT the previous season.
Agriculture Canada predicts grower bids for all classes and grades of lentils will range between $555 and $585 MT this season and between $600 and $630 MT in 2015-16.
AgCanada Comment
Bobby Morgan's comments about lentils continue as follows:
For 2014-15, lentil exports are forecast to be slightly higher than the previous year to a record 1.8 million MT. Of this total, 1.2 million MT are red lentil types with the remaining 0.6 million MT consisting of the green lentil types. The main markets continue to be India, Turkey, EU and the United Arab Emirates.\
Total domestic use is forecast to decrease to 0.3 million MT. Carry-out stocks are forecast to fall to extremely tight levels. The average price for all types and grades is forecast to be higher than last year due to tight carry-out stocks despite a below average grade distribution.
Red lentil prices have maintained a large premium (C$130 MT) over large green lentil prices, the highest since 2011-12. During the month of June, Saskatchewan large green lentil farm gate prices and red lentil farm gate prices have strengthened. This is largely due lentil crop development issues in Saskatchewan and Alberta, despite the confirmation of a large increase in the Canadian lentil seeded area by Statistics Canada for 2015.
For 2015-16, Canadian lentil seeded area increased to a record 1.57 million hectares, due to higher forecasted returns compared to other crops. This is a 24% rise in seeded area from 2014-15, with the majority of the increase in red lentil types. By province, Saskatchewan accounts for 94% of the lentil area, with the remainder seeded in Alberta.
Production is forecast by AAFC to increase by 11% to a record 2.2 million MT, with supply rising marginally due to low carry-in stocks. Exports are forecast to remain unchanged at 1.8 million MT. Carry-out stocks are forecast rise to 0.15 million MT. The average price is forecast to rise from 2014-15 if Canadian export demand continues to remain strong for the third consecutive year.
In the US, the area seeded to lentils for 2015-16 is forecast by the USDA at nearly 0.4 million acres, up 37% from 2014-15 due to higher area seeded in Montana and North Dakota. Assuming normal yields and abandonment, 2015-16 US lentil production is therefore forecast by AAFC at 0.2 million MT, up 37% from the previous year. The main US export markets for lentils are expected to continue to be India and the EU.
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