Lentils 2006

[lakenheath]

Many producers I have talked to in our area has been sitting on every bushel of lentils they grew in 2005. How flooded is this market? I understand right now is traditionally a slow time for lentil buying/selling, but are there any signs of some price movement in 2006? Before the 2005 crop was even seeded, there were no attractive forward contract prices. I can't imagine any pre-seeding contracts for 2006. I wonder if a person is going to have to wait this out for another year in hope of stocks getting used up, or a disaster somewhere in the world of lentils.

Nitrogen prices are not going to help with the seeded acres in 2006 for lentils. However, some tradionally huge lentil acre farmers in our area are considering switching to peas (cheaper to produce), but peas are no hell right now unless you hit over 60 bushels per acre.

I wonder if we have flooded this market in terms of acres? I was at a pre-seeding meeting in Lethbridge in 2005 where Gary Pike told a room full of Alberta producers that they are crazy not to grow more lentils. Imagine if Alberta got into lentils like Saskatchewan has. Yikes! A friend of mine from Saskatchewan was signaling to Gary to shut up.

I am getting a little impatient here. Grain rich but cash poor. And using the word rich is a bit of a stretch.

Maybe Charlie has some insight on this one.

[TOM4CWB]

Lakenheath;

Best if you invest some time in the SaskPulse days, Jan 9, 10, and 11th in Saskatoon.

We have many good items on the agenda!

See you there if you decide to come.

http://www.saskpulse.com/pulsedays/

[charliep]

My concern would be losing grade in storing. A good conversation is the Pulse & Special Crop Threads.

http://www.agri-ville.com/cgi-bin/forums/viewThread.cgi?1133290207

Comments have been made on segregating the lentil markets. Red lentils tend to be more of a world market and used in more products (replace chick peas, other pulses in things like hummus). More countries produce reds. Lairds (large seeded I should call them) are at the other end of the spectrum in that Canada is the major producer so we are more maker of our destiny (actually in many ways similar to durum).

Has anyone done budgets yet? Given every crop is struggling price wise, are there crops that seem to have higher profit potential? A comment is that lentils have always showed up well profit wise but that is very dependent on type/production levels. Risk tolerance and crop rotation also come in.

As with other crops, market development to grow markets is also important - Pulse Canada is the driver here.

[nw9flynn]

I have worked 2006/07 budgets assuming 0.12 for #1 LGL and 0.10 for a #2 LGL.
I do not think that we will see the acres or the production of this past year but we will have a large carry over to deal with that I beleive will continue to depress the LGL market.
I think Red lentils acres will explode. I've worked my budget on 0.135 to 0.14.
The only good news is that the world market should be able to handle a western canadian over supply of RL easier than the over supply of LGL.
Using average yeilds I can make these numbers work but I don't see much more upside on prices without a major production problem combined with a lower CDN dollar.

[Pulseman]

Question to TOM4CWB. What interesting issues would you have in Sakatoon beside people being proud of their achievment of testing every price bottom in any prairie pulse crop exept kabuli chickpeas? The only truth I have heared in Sakatoon over the years is= "we will lower prices until we have the market".

The size and approach of the Sask. pulse industry is to destroy what ever is in its way, this includes Alberta and Manitoba. No bottom price level exists in Sask. give a few producer with each 50,000 bushel of peas $1.80 per bushel at harvest and they will sell 30% of their production and the whole market goes to pieces and has a hard time to recover before February. Sask. is the reason why we still have a CWB (and you have it in your identity) and this is all Sask. deserves. Sorry, but thus boy's and girl's are without the necessary brain to get out of their own dug hole, this includes the wise man from the Sask. Pulse Association and their 1% enrichment fond. Have much fun in Sakatoon and absorbe the shoulder pading without me, I rather go skiing with my family, less frust, more fun.

[lakenheath]

PulseMan,

Please expand on you accusations towards the Saskatchewan Pulse Growers (how they drive the pulse market into the ground). I am probably the worst for rushing posts (spelling errors, poor grammar, etc), but try to post in complete thoughts (this will help us understand your post better). You seem angry towards us Sask. farmers. Why the rage?

[carebear300]

I have personally given up on going to pulse days. In the past I used to relish every minute of the meetings trying to accumulate every bit of knowledge I could from the speakers and more so from producers that had lots of good production hints. But the speakers over the years have given some pretty iffy imformation at times. On two instances I remember speakers getting up and saying that we couldn't grow enough peas to supply the market(the last time saying to go home and produce three times as many), the thing that they didn't tell us at what price we would be stuck with after. That result is very apparent, there is a market for every bushel of peas that we produce at a price below the cost of production. And that doesn't do us producers any good at all, it is like the wheat market all over again, become more efficent and produce more to sell for less. I have had way to much experience and now need money!!!!!

[TOM4CWB]

Pulseman;

You ask valid questions... yet your anger may be pointed in the wrong direction.

In talking to Garth Patterson, we have gone through exactly the issues that you bring foreward!

Garth made it clear to me that in studies SPCDB has done... the % of return is NOT as good as in some other grains... like Canola for instance.

We, on our farm, just sold another stage of Canola @ $4/t over March... on the basis factor alone...

If we want to seculate on price we can own paper or buy options. BUT we MUST continue to move the Canola... or we will not work through the pile far enough to see the other side!

The other side is to get enough of the crop marketed that a price rise can bring back value and profitability to those who NEED a higher price to survive!

DID the #'s yesterday... sold $5.50 Canola... and $100/ac in the pocket AFTER all expences at custom rates except management/land costs.

NOT a bad return... which brings us to why the Canola price is where it is at.

Bear Pit sessions with Marlene Boersch – Mercantile Consulting Venture
on Wed. Morning will get into some of the issues that concern us in the area of marketing -

As a percentage of return, do marketing $'s in Pulse crops compare with CWB/Canola?

Is risk management, or lack thereof costing pulse growers big dollars?

Can you sell your lentils and buy paper to build a better market for next year?

IS there an extra pulse marketing cost; as farmers in the northern plains of North America, because we have no hedge/futures contracts for our products?

A commodity: vs. a IP closed chain system. Valid questions; our industry has grown...can manage the risk ourselves?

DO we want all this risk for ourselves...

Have pulses out grown the IP system and become a commodity that needs risk management tools like Canola/Wheat/Bly have?

Where does the CWB/AWB fit into these issues?

[sawfly]

Pulseman

So now its blame it on saskatchewan.

hey thats a free market,exactaly what alberta wants.
I should be mad at Alberta for selling canola for 5$, i only grew 30 bushell so 5$ dosent cut it for me.

maybe the sask guy dosent have 20,000$ in oil lease money, or can 't sell a qtr. for 500,000$ to get out of debt. maybe he needs the money.

maybe we should have a canadian pulse board to hold product off the market to maintain the price, like for durham under the CWB

why are we argueing about petty marketing differances. that aren't gonna make much differance any way. their all in the toilet. Keep them fighting amonst themselves,divide and conquer.

Monsanto shares went up 60% last year.
The Cdn. govt.leaves us with a 70$/acre subsidy disadvantage versus our amercian neighbours,and your mad because a sask. farmer sold his peas too cheap.

[TOM4CWB]

Swafly;

It is simply astounding how marketing our grain in the "designated area" brings out such passion... where is the logical, common sense, analisis of our situation?

Could we do better?

Yes, I believe we could if we were to share risk... and a portion of the reward for sharing this risk in return.

Can't this be a logical discussion on how to diversify risk to allow those who need a more stable income that opportunity?

If not, why not?