Yellow peas are seeing the impact of increasing domestic demand, as Prairie processing plants help push prices higher.
While China is typically a major buyer of Yellow peas, it is demand from Western Canada’s burgeoning fractionation industry that is the key market factor, said Kent Anholt, operations manager and merchant for Rayglen Commodities Inc. in Saskatoon.
“It’s driving the market,” Anholt said. “Overseas trade . . .is just not as competitive as what the fractionation market is paying locally.”
Amid that demand and tight supplies caused by this summer’s drought, Yellow peas are now fetching as much as $17.50/bu, almost double the previous year.
“Crops were pretty decent around the Manitoba/Saskatchewan border, but you didn’t have to go too far west of Regina (to see) pretty poor numbers,” said Dale McManus, broker for Calgary-based Johnston’s Grain. “In normal years, it would be fine. But we have a couple more (pea processing) plants that have opened up and a below average crop. That’s going to tighten things up.”
Billed as the largest facility of its kind in the world, the Roquette pea plant near Portage la Prairie is expected to process about 125,000 tonnes of organic and conventional yellow peas annually. The plant is expected to reach full production capacity in early 2022. Merit Functional Foods has another Manitoba-based wet fractionation plant, while the Prairies is also now home to a number of dry fractionation facilities.
“No one has a crystal ball (to predict prices), but $17, $18/bu. is already a historical high,” McManus said.
In its September supply-demand estimates, Agriculture Canada forecast 2021-22 total Canadian pea ending stocks at just 50,000 tonnes, down from 479,000 just a year earlier.Click here to see more...