‘Open’ export window for pulses

The world agricultural markets — grains, oilseeds, sugar and others reeling under a strong rebound in production and markedly softer prices — are likely to face further downward price pressures, thanks to record harvests expected in India. A recent media headline described Sharad Pawar as the World’s happiest Agriculture Minister; and why not?

Much more than rice and wheat, the interesting success story is that of pulses whose production is set to record a new high of 19.8 million tonnes (mt) this year (2013-14), markedly higher than the record 18.4 mt last year. Of this, gram or chana harvest is pegged at 9.8 mt, much higher than the season’s target of 8.7 mt and surpassing even last year’s record 8.8 mt harvest.

Rabi pulses acreage has hit a new high of 16.2 million hectares (mh) this year, nearly a million hectares higher than the previous year. Gram or chana planted is at an all-time high of 10.2 mh (9.5 mh). Chana accounts for nearly 50 per cent of the country’s total pulses production. Weather conditions have been near ideal in the last two months and chana yields are now a little over 900 kg/hectare, gradually inching towards the one-tonne-a-hectare mark.

Market arrivals in some centres have commenced and will gather momentum in the coming days. With a huge rebound in pulses production in the last two years, supplies are aplenty, augmented by imports. But clearly, pulses imports have slowed. Pulses suppliers to India – decidedly the world’s largest producer, importer and consumer – are a worried lot today. Already decelerating, pulses imports into the country are set to slow down even further in the months ahead when domestic arrival pressure builds up.

In the first nine months of fiscal 2013-14, pulses arrivals from abroad aggregated 2 mt; for the whole year, imports are projected at 2.6 mt, sharply down from 3.8 mt last year, according to Commerce Ministry data. Anecdotal evidence suggests a distinct lack of interest among Indian importers following a sense of caution, thanks to the recent currency volatility and threat of a fiscal impost. Amid the euphoria over record harvest, it is time to ensure the marketability of the record pulses crop. Logically, storage and similar administrative restrictions on pulses must be withdrawn so that dal mills and traders are able to build inventory.

It is equally important to open the export front. Pulses export (except for kabuli chick pea) has remained banned for nearly seven years. It is time to lift the ban and allow free exports. There needs be no apprehension of excessive exports because the world market is awash with pulses.

Given the limited absorption capacity of the overseas market, India may be able to ship out about three lakh to five lakh tonnes in the coming months. Keeping the export and import window for pulses open simultaneously will make for a really progressive foreign trade policy.

India’s record pulses crop, slowing import and prospects of exports, is sure to dominate the conversation during the upcoming Pulses Conclave organised by India Pulses and Grains Association in Goa from February 19-21.

Sharad Pawar, as the chief guest of the conclave, is sure to be delighted to inaugurate the mega event on pulses, and is likely to make some important announcements, it is widely believed.