Miller Magazine Issue: 130 October 2020

86 MARKET ANALYSIS MILLER / OCtOber 2020 red the conference participants that the world will be able to accumulate strategic reserves, especially in the countries of Southeast Asia, where legumes are an im- portant part of food culture and an important staple food. Ms Brown from GPC also highlighted the impor- tant role of legumes in the structure of the consumer basket. Mr. Feofilov from UkrAgroConsult devoted his report to the potential of trade development under qu- arantine conditions, and highlighted the important role of the Black Sea region. Despite the decline in production after 2017, Russia, Ukraine and other countries in the region are trying to maintain export volumes. For Ukrainian legumes, the main markets remain the EU, India and Turkey, whe- re both peas and other crops are actively sold. Russia, besides these countries, is also active in the Pakistani market. For the last two seasons, Ukraine has occu- pied 4% of the pea production market, while Russia produces 17-18% of all world peas. Due to the global trend of lower prices for raw materials, the main factor that stimulates farmers to expand their areas has been lost - profitability. Mr. Feofilov hopes that the desire of countries to increase stocks in a quarantine environ- ment will bring about this trend. At the same time, in 2020, there is still a revival of demand from India for legumes, but not due to peas in 2020, but due to a decrease in the duty on lentils to 10%, which was in effect until August - therefore, they were purchased mainly with lentils. The main supplier of lentils India - For a nada (even Australia, but there are disparate volumes). Canada was able to take advantage of the reduction in import duty on lentils in India and shipped 64% more in 2019/20 than 2018/19, which is almost equal to purchases in 2016 (before the introduction of quotas on legumes). Ukraine is still focusing on peas as the main export crop in niche legumes. The share of exports in the 2020 crop is estimated at 75%, which almost coincides with the average for the last 5 years (76%). The high share of exports in the crop indicates that peas are an export-oriented crop. Therefore, the closure of the In- dian market immediately caused a reduction in crops. In 2020, due to a poor corn harvest in the region, the role of peas as a fodder component may increase, that is, a potentially high import demand within the regional or EU is possible. In Ukraine, export started well in 2020/21 MY (+ 25% from last year ), but we can expect a decrease in export rates (the curve will be similar to last year), as the Indian market is still closed. The main export directions in July-August are the same as a year ago - Italy, Spain, the Netherlands. Operati- onal data from the ports show 20.5 thousand tons in September (the direction is the same - Spain). The export of legumes other than peas is still focused on chickpeas. In January-August, the export of chick- pea amounted to 30.6 thousand tons (56% more than on the same date last year ), overtook beans for the first time in the first 8 months of 2020. Due to low production, Ukraine was unable to take advantage of the increase in the price of lentils, because in 2020 the sown area decreased significantly. Farmers' trust in le- gumes continues to wane, peas are already a proven crop and continue to be planted as a good predecessor. Official data is available only for peas and beans (in the table). The increase in the area under beans is due to their high price. There are no exact data on all other legumi- nous areas, but the official information is 29 thousand hectares - this includes chickpeas, lentils, vetch, lupine, broad beans and more. Ukrainian farmers did not take advantage of the rise in the price of lentils and sowed them in scanty quantities. In 2020, the price began to rise, the whole world reacted with an increase in acrea- ge, except for Ukraine, Russia and Kazakhstan. Exports will decline. Competition in the lentil market for Ukraine is Ka- zakhstan. After a peak in 2017 began to reduce len- til crops. In 2020 - especially, we decided to return to wheat (no surprises). Problematic sales: India - duties on all legumes, Turkey - remains the main buyer.