Tuesday September 02, 2014

Farmers shouldn’t forget pulse potential

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Trends in agriculture are an interesting thing.

At present, on the cropping side of the agricultural equation on the Canadian Prairies, the trend is one which seems to be taking the sector in the opposite direction of what everyone was focusing on just a few years ago.

Diversification was the word of the day in the very recent past.

There was a recognition the traditional mix of wheat, barley, and occasionally oats was not a farm rotation which could generate the returns a farm demanded.

Wheat markets were solid, but the upper prices reached were not generating major profits.

Barley was generally a livestock feed and thus lower valued.

And oats, a static market which had evolved to basically niche status.

The call went out far and wide to diversify crops.

And Prairie farmers responded with coriander, caraway, pinto beans, chickpeas, lupins, fenugreek, borage and a list of others.

Most of the crops were shown to be able to be grown here successfully, but the limited market for most really did little to change the cropping landscape.

And then prices for commodities pushed higher, taken there by growth in economies in major markets like China.

And farmers went back to pretty basic crop patterns, canola outstripping wheat, and the rest of the crop options used only when rotations demanded something different from the big two crops.

In the United States farmers have been on a corn-soybean system for years, and Canada seems headed that way with canola-wheat.

Marlene Boersch, Partner Mercantile Consulting Venture spoke at the recent Grain Millers Harvest Showdown in Yorkton where she said the Canola Council had been predicting canola production in Canada would hit 15 million tonnes by 2015, but this years crop is now estimated at 16-16.4 MT “up 15-16 per cent from last year.”

Canadian farmers have always been among the best at growing red spring wheat, and clearly are following that tradition with canola.

There is merit to growing what you are good at growing, but farmers need to recognize other crops could have merit down the road, and we need to remain focused on building relationships and markets now to take full advantage of emerging markets.

Lyndon Carlson, Senior Vice President Marketing, with Farm Credit Canada also spoke at Harvest Showdown. He told those attending Canola Days at the event that while the economy in India lags behind that of China, it remains another major growth market for exports, especially with the expectation “the Indian population will surpass China by 2030.” He added it is also forecast exports to India are expected “to grow by 300 per cent in just the next three years.”

India is a country which loves its legumes, lentils, chickpeas, peas and beans.

Canada is already a major exporter in the legume sector, but it is clear moving forward there is room for major growth in acres grown and tonnes exported.

We see the effects of some of that growth potential already.

BroadGrain Commodities Inc. has invested in a major expansion project at its pulse and special crops processing plant in Dafoe, Sask.

The trading company bought the plant from Lakeside Global Grains Inc. in 2011 and has invested $2.9 million over the last four months to double the plant’s storage and handling capacity and make it more efficient.

Granted farmers plan their cropping intentions based predominantly on market signals — high prices push farmers to plant more acres — in the case of pulse crops, with their ability to fixate nitrogen to reduce fertilizer costs, and now to build a market for the future, legume crops need to be a consideration for farmers moving forward.

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