Pulses

GVP $268 million est. Down 52% year-on-year.
Chickpea production fell 62%.
India is emerging as a key competitor in key Australian chickpea export markets.

NSW pulse production fell dramatically, impacted by weather-related production risks. Pulse prices were relatively flat year-on-year, with no significant changes in global demand. Exporters continued to note the impact of the lack of presence of the Indian market, and other key destinations struggled with ongoing supply chain issues and economic uncertainty.

Production

Muted desi chickpea prices and a high disease risk due to wet seasonal conditions, resulted in NSW pulse producers continuing to rethink rotations, with pulses losing area to competing winter crops such as wheat, canola and barley. The total area sown to pulses in NSW in 2022-23 decreased by an estimated 28% year-on-year to total 315,000 hectares,¹ driven largely by a decrease in chickpea production. The decrease in planted area, combined with a return to trendline yields, curbed the upward production trend experienced in recent years, and total pulse production fell 48% to 406,000 tonnes.¹

Chickpeas continued to be the dominant pulse crop in NSW however, production declined considerably, dropping 62% to 192,000 tonnes, the State’s smallest chickpea crop since 2019-20.¹ Seeded area was reported at 160,000 hectares, down 43% year-on-year.¹ Whilst the average state yield was 1.2t/ha, just under the 10-year average, widespread weather-affected quality downgrades and reports of mould, impacted many of the major NSW growing areas. Unseasonal late spring rains and widespread flooding across the Namoi and Gwydir Valleys (the State’s two largest chickpea growing regions) resulted in harvest delays and yield losses.

Following two years of high yielding crops and with many soils across the key cropping areas experiencing flooding or prolonged periods of saturation, soil nitrogen levels were reported to be low.⁶²⁶³ As faba beans leave more residual nitrogen after harvest than chickpeas, and in response to high urea and low chickpea prices, the estimated seeded area for faba beans increased 12% year-on-year.⁶⁴ Unfortunately, lower year-on-year average yields resulted in production falling to an estimated 81,000 tonnes, 19% less than last year.¹

NSW pulse production and share of winter cropping area¹

Download data (.XLSX)

Lentil production remained at historically high levels at 15,800 tonnes, down slightly on the record production of the previous year, but still well above the 10-year average production of 6,500 tonnes.¹ Lupin production declined by 43% to 70,000 tonnes as the estimated seeded area for lupins was cut by 26%, the smallest area since 2019-20.¹

Price

Average seasonal producer prices for pulse crops in 2022-23 were relatively subdued. Whilst most pulse crops experienced short-term price rallies throughout the year, firming slightly during harvest in response to the mixed outlook for the new crop, on-average, prices remained relatively flat year-on-year.

Sluggish global demand resulted from a massive increase in Indian domestic chickpea production. The average price for chickpea (delivered Junee) was $486/tonne, 4% lower year-on-year.¹²² Wet harvesting conditions for a significant portion of the crop resulted in quality downgrades and impacted prices with reports of downgrades of up to $100/tonne at some sites for mould-impacted chickpeas.⁶⁶ Over the past few years, prohibitive freight rates and container shortages encouraged an increased number of bulk shipments of pulses which in the past, were typically containerised. This situation had eased to some degree by early 2023 however, some ongoing issues remained including rail and road inefficiencies, which made it difficult to get containers into Port Kembla and hindered current-crop sales, placing further pressure on prices.⁴² Ramadan demand from South Asian markets during the final quarter of 2022 and the first quarter of 2023 provided a boost to prices over the spring and summer months amid more supportive exchange rates.

For lentils, the prospect of the large Australian domestic and Canadian lentil crops resulted in prices falling for lentils as well as chickpeas early in the season, limiting selling from growers. Combined with the uncertainty related to new crop quality and container availability, prices fell by up to $50/tonne in the months leading up to harvest.⁷²⁷³

Faba bean prices also struggled under the weight of supply arising from significant carry-over stocks from the record 2021-22 crop and a large new season crop. Lacklustre export demand put pressure on values early in the year however, strong demand from the stockfeed sector helped put a floor in prices.

Pulse Prices (del. Junee)¹²²

Chickpeas
Field Peas
Lupins
Faba Beans

Download data (.XLSX)

Whilst competition from the domestic stockfeed market has absorbed tonnage from the current crop. On average, faba bean prices (delivered Junee) were $362/tonne, a 9% decrease year-on-year.⁷⁴

Average field pea prices (delivered Junee) were 3% lower to $473/tonne compared to the previous year and lupin prices (delivered Junee) were relatively steady year-on-year at $424/tonne.⁷⁴

Trade and Macroeconomic Conditions

Global demand for pulses did not significantly change during 2022-23, but the mix of competitors and destinations continued to shift. The ongoing absence of the Indian market, coupled with a large 2021-22 season carryover ⁶⁷ and the incoming 2022-23 production, resulted in a large exportable surplus which weighed heavily on traders. Prohibitive container rates, which had impacted the competitiveness of Australian pulse exports during 2021-22, had improved somewhat by late 2022, driven by reduced freight volumes between China and the EU and US, and increased capacity on secondary routes covering SE-Asia and the Middle East.⁶⁶ However, the trade to the traditional Australian and NSW pulse export markets of Bangladesh and Pakistan continued to come under pressure due to economic challenges and associated foreign exchange issues which placed questions on their ability to honour contracts.⁶⁶⁷¹

NSW exports of pulses totalled $138 million in 2022-23, a 27% decrease over the previous year.³⁵ The decrease was driven by a decline in the volume of exports which were 32% lower year-on-year. Desi chickpeas remained the dominant pulse export from NSW and Pakistan remained the principal market, accounting for 61% market share by volume and increasing in value by 65% year-on-year to $77 million.³⁵ The UAE replaced Bangladesh as the second most valuable chickpea market, valued at $21 million.³⁵

NSW Monthly pulse exports to Bangladesh, Pakistan, UAE and India³⁵

Bangladesh
India
Pakistan
United Arab Emirates

Download data (.XLSX)

In past years, Australia has not had much competition for its desi chickpeas on the global market as export volumes from other origins have totalled less than 100,000mt.⁶⁷ However, this situation is beginning to change. Despite being the world’s largest producer and consumer of desi chickpeas, India has traditionally been an importer however, the Indian government buying program (Minimum Support Price – MSP) has increased production and made domestic prices for desi chickpeas more competitive. The country is becoming a net exporter which has brought Indian produce into price parity with destination markets such as Bangladesh, the UAE and Iran.⁶⁷ Indian chickpea exports provided stiff competition for Australian exporters in 2022-23, taking over many of our traditional and largest markets. During the first five months of 2022-23 (Apr to Aug), India exported more chickpeas than the whole of 2021-22.⁶⁹

The Australia-India Economic Cooperation and Trade Agreement (AI-ECTA) was ratified by the Australian Parliament on 23 November 2022 and negotiations for a full free trade agreement commenced in 2023. This Agreement offers significant potential for Australian growers by eliminating or reducing tariffs on nearly 90% of Australian food and agricultural exports to India including immediate opportunities for barley, oats and lentils and over-time, faba beans.⁷²

Unfortunately there was nothing in the agreement that was supportive for desi chickpea exports and due to high tariffs, imposed by the Indian Government in 2017 and again in 2018, access into the Indian market remains restricted for Australian desi chickpeas.⁷⁰

Thailand relaced Egypt as the largest buyer for faba beans in 2022-23,³⁵ as currency difficulties resulted in only minimal quantities purchased by Egyptian importers. With another sizeable Australian domestic crop, carry-over stocks were considerable and despite robust domestic demand from stockfeed millers, the market struggled to absorb the volume of product.⁷³

Outlook

While the area planted is set to remain relatively steady, the forecast is for a 7% decline in total NSW pulse production in 2023-24.¹ Production is set to continue to decline for chickpeas and lupins, offset slightly by a forecast increase in faba beans and field peas. Dry conditions at planting severely limited the area planted to chickpeas in Northern NSW however, pulse crops already in the ground in the south of the state have experienced average to above average conditions and most should have enough residual soil moisture to see them through to harvest.

Demand for pulses remains positive, however ongoing credit issues in key markets such as Pakistan and Egypt may continue to impact export volumes.

Stronger Primary Industries Strategy

Paddock to supermarket traceability

Strategic Outcome

Biosecure Industries and Environment

1.3 Rapidly and efficiently contain biosecurity threats

Digital solutions helping to trace food from paddock to plate

As consumers demand more transparency around what they are eating, NSW DPI is encouraging fresh food producers to use technology to track and trace a product’s journey from paddock to plate. Biosecurity incursions, food safety recalls or emergencies such as floods or bushfires need rapid responses to protect the supply chain and consumers but gathering this information takes time.

Until now, that is. A pilot study using GS1 data standards and a GS1 Digital Link QR code to create a digital map of products in the NSW cherry and potato industries has the potential to change that. Study results showed that using an integrated digital traceability system can improve industry competitiveness, buyer confidence and market access for horticultural products produced in NSW. In a new era of food security challenges, traceability provides transparency of a product’s provenance and where it is in the supply chain, providing consumers with confidence in a high-quality Australian product. By working with growers, the study improved understanding of what is required on-farm to enable traceability and what the benefits would be to others along the supply chain.

As part of the study, unique serialised QR codes with a GS1 Digital Link label were applied to Woolworths-branded brushed potatoes and organic cherries bags and punnets. The GS1 Digital Link was encrypted with location data and a scannable QR code, which led to an interactive consumer application that could be viewed on a smartphone. The GS1 Digital Link enabled the product to be traced in real-time, from property to store. It also provided information about how the product moved along the supply chain, the time spent at each location and allowed for real-time feedback from consumers. Capturing and sharing data at every point in the supply chain — growers, carriers, retailers and the government —can enable full trace-back and trace-forward visibility in real-time.

The pilot study was conducted in partnership with Woolworths, Food Agility CRC, Freshchain Systems, GS1 Australia, Mitolo Family Farms, Cantrill Organics and Cherry Growers Australia.