Canadian pulse crop sales to India dry up over pest-control plan

Thu Feb 23, 2017 1:22pm EST
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By Rod Nickel and Rajendra Jadhav

WINNIPEG, Manitoba/MUMBAI (Reuters) - Canadian exporters are slowing sales of peas and lentils to India, threatening C$1.1 billion ($762.95 million) in annual trade of the food staples, over risk that New Delhi may reject shipments under its tougher approach to pest control.

India requires shippers to fumigate crops with methyl bromide, an insect-killing gas, in the country of origin, but has historically made an exception for Canada, the world's biggest pulse exporter. Methyl bromide, an ozone-depleting substance, is not made in Canada, but is allowed for use in limited situations.

Canada's exemption, allowing crops to be fumigated on arrival in India, is set to expire on March 31, overlapping with the 30-40 days it takes for shipments to reach India from Canada.

"It's just a completely dead market right now for us," said Tamara Khoma, trader at Providence Grain. The company rerouted a pea shipment to China that had been headed for India.

"Sales to India have been almost non-existent," said Zaid Qadoumi, chief executive at Broadgrain Commodities. "We are in waiting mode."

Pulse crops are a popular protein source in India, the world's largest importer.

India’s pulse production looks to rise this year by 35 percent from a year ago to 22.14 million tonnes. Even so, the country also needs to import yellow peas and lentils, said Pravin Dongre, chairman of the India Pulses and Grains Association.

"The entire supply chain will be disrupted if the government sticks with the new rule," Dongre said, adding that fewer imports could lift prices in India.   Continued...

File Photo: A labourer displays a handful of lentils which he was preparing to package for sale at a market in Karachi October 11, 2009.  REUTERS/Akhtar Soomro/File Photo