The field pea crops in Southern Sask are absolutely unbelievable. I am 5'11'' and standing the peas they are on average bewteen my knee and my hip. They are podding out at 6 pods per plant with 9 flowers starting to make pods. Most are filling 7 to 8 peas per pod. There are record acres in Sask this year. In 2000 we had a big peas crop and price fell to $2.75/bu. But in 2000 the feed market was not as strong for peas. Anyones thoughts on forward contracts now or what the market might do?
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How are the pea crops handling the recent hotter weather?
I just checked Stat Publishing for current new crop bids (http://www.statpub.com/stat/prices/spotbid.html) and see yellow edibles in the $4 to $4.25/bu range and greens in the $4.50 to $5/bu range. No quotes feeds. Does this fit with what other are hearing?
A larger crop will allow more feed peas to go into domestic feed rations. A rule of thumb is that feed peas should be valued at 1/3 the price of soybean meal and 2/3 the price of feed wheat based on pig rations. Logic - all three ingredients have about the same energy. Protein, however, is obviously different with a blend of 46 % soybean meal and 12 % feed wheat versus peas at 20 to 22 % (always a discussion around actual/variability in feed pea protein).
To your question. Based on the above, I struggle to see feed peas at $2.75/bu unless feed wheat craps out more (i.e. a poor quality wheat crop this fall). a larger crop will mean more consistent supplies for the domestic feed industry and I suspect higher inclusion in rations.
A larger/more consistent feed pea crop will create opportunities into China/S.E. Asia feed markets. Lots of market development there but Canada has not had the supplies to consistently supply this market.
What are others thoughts?
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Not much for peas here in the North Peace, add to that wheat & canola. We just had 1 inch of rain, Our second rain since seeding & our 2nd major crop failure in 3 years.
I will be surprised if my canola does over 15bu/ac. I talked one farmer today and I could see it in his face & voice that he was in trouble. The fear & despair clearly displayed not hidden. The looking for a solution to a problem that has no answer and no way around.
Crop insurance won't be going far enough this year. Not surprising since AFSC cut back on the coverage. They just cut back on the premiums to hid their drop in value.
The statistic that sticks in my head is 2% of farmers a year quit. It doesn't seem to bad but when you figure 5yrs=10% & 10yrs=20% you see the problem.
The gov now wants manditory CAIS deposits Instead of putting our money back into the farm put it into the bank...into CAIS. Don't invest it back into your farm, don't invest in Agriculture.
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You still have to include the value of soybean meal. Price today about $450/tonne. 1/3 of the value is $150. Value of feed wheat contribution - $100/tonne (2/3 of $150). Value using this formula - $250/tonne.
Obviously, feed pea prices are not this high but provide a good indication that feed peas have been price competitive had a good fit into rations.
Just a comment that we need to start thinking about feed peas like feed barley. Work toward developing high yielding and palitable varieties without concern for the visual characturistics needed in human consumption peas. Longer term, there will be good markets both here in Canada and S.E. Asia.
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Thanks for the information. Suspected I might have been given the sucker price where I phoned. That would make feed peas worth about $200/tonne. Feed mills seem to like to discount some more for potential earth tag (dirt on seed - hard on rollers) as well as value at the lowest potential protein they can expect.
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Just for a note on where the numbers come from. I use the Pearson square (my name sake) to balance the protein. Soybean meal - 48 % protein. Feed wheat - 12 % protein. Difference 36 %. If you assume feed peas at 24 % protein (likely high), a blend of 1/3 soybean and 2/3 wheat will provide the same protein level. My guess is most feed mills will blend on the basis of 20 % protein peas which would result in an equivalent more in the area of 75 % feed wheat and 25 % soybean meal. That would put the value of feed peas closer to $185/tonne.
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Charlie,
The stand of peas still looks good. Althought the heat did abort the top few flowers. It is really hard to guess what they are going to yield. Pod counts don't seem to provide any valuable info this year. I don't think the yield will be as good as the stand. We'll know when when we get the combines in there.
Based on your calculation do you think there is the potential for feed pea prices to be higher than edible prices. I would sell all my crop next month if I got $5.00 a bushel. Is your estimate realistic or more scientific speculation.
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Would put more on the speculation end of the world. Feed wheat more likely closer to $120/tonne. Soybean meal closer $280/tonne. Using 75%/25%, that would put value at $160/tonne. Will feed mills pay this much? Not likely. One of the pulse industies biggest challenges is to convince the feeding industry to start including more peas in rations/replace soybean meal. The other side of this coin is to get the grower side to provide consistent supplies. A market development challenge for both industries.
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