CNS Canada — As negative features continue to mount in Canada’s lentil market, prices are following the tried-and true phrase, ‘What goes up must come down.’
Lentil prices skyrocketed ahead of this year’s growing season, but now the market is starting to trend lower.
“This isn’t a disaster; it’s just that gravity is pulling it back to normal,” said David Newman of Commodious Trading Inc.
Statistics Canada has estimated lentils’ seeded area at 5.1 million acres, the highest number ever recorded.
“People were OK with a big crop, but thought it might be dry, which would reduce yields,” Newman said.
But as rain fell across Western Canada, the market started to price in bigger yields.
“And now India is looking like they’re going to have a good monsoon season,” Newman added. A favourable monsoon season will support crop development in the country.
Limited complications with Australia’s lentil crop mean Canada will have a bigger carryover than previously thought, which added to the declines.
However, if those weather-related influences change throughout the summer, the trajectory of lentil prices could shift.
“But you keep stacking on these negative things, and as long as those negative things don’t change, the trend will not change,” Newman said.
New-crop prices for No. 1 crimson lentils range from 28 to 40 cents per pound, depending on quality, while No. 1 Laird lentils are between 42 and 45 cents per pound, data from Prairie Ag Hotwire says.
Old-crop prices for No. 1 crimson lentils are between 39 and 48 cents per pound, while No. 1 Laird lentils are as high as 72 cents per pound.
— Jade Markus writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.