Pea prices should improve but big rally unlikely

SASKATOON — Pea supplies are heavy but there are some bright spots in the market, says an analyst.

Chuck Penner, president of LeftField Commodity Research, is forecasting 1.24 million tonnes of carryout at the end of 2025-26, a 154 per cent increase over last year.

The stocks-to-use ratio is forecast at a bloated 38.9 per cent.

The breakdown is estimated to be 943,000 tonnes of yellow peas and 300,000 tonnes of greens.

While supplies are up, exports have been below average through the first four months of the 2025-26 campaign due to China’s 100 per cent tariff on imported Canadian peas.

Russia has largely usurped the Chinese market, although some Canadian product has still been moving to China despite the massive tariff.

Russia harvested a record 5.2 million tonnes of peas in 2025.

“They’re a major player now in the pea market and have been for a few years,” Penner told farmers attending Saskatchewan Pulse Growers’ Swift Current Winter Pulse Meeting.

The good news is that China’s tariff is being removed on March 1, 2026, at least until the end of the calendar year.

Penner thinks there will be significant pent-up demand for Canadian peas.

“Pea inventories in Chinese warehouses are the lowest they’ve been in many years,” he said.

Why it Matters

China’s return to the pea market is a big deal.

The other thing that has been happening in that market is that pea prices have fallen to a level where they are competitive with a composite of soybean meal and corn values.

He expects China to continue importing Russian peas for feed and to start purchasing Canadian peas for the fractionation market.

“We’re going to see some decent volumes moving March forward in this year,” said Penner.

Canadian pea exports to India also took off in October and November after a poor stretch from February through September 2025.

Yellow pea prices started to rise in India after the government implemented a 30 per cent tariff on imports from all countries in November. Desi chickpea prices are also moving up.

“It’s positive that prices are rising in India,” said Penner.

“It does give us a little bit more optimism for the yellow pea market going forward.”

Canadian yellow pea bids have been slowly rising, and he thinks there could be more appreciation this winter due to the improving export prospects in China and India.

He is forecasting 2.35 million tonnes of exports to all destinations in 2025-26, up from 2.17 million tonnes the previous year.

Penner is forecasting 3.15 million acres of peas in 2026, a 15 per cent drop from last year.

Using average yields, that would result in 2.94 million tonnes of production in 2026-27, which would be about one million tonnes less than the current crop year.

“That in itself would fix some of the heavy supply situation,” he said.

Penner is forecasting 826,000 tonnes of carryout in 2026-27, a 34 percent drop.

As a result, there should be some price recovery next year but no “screaming rally” unless there is a crop failure.

Canada’s chickpea production exploded in 2025 to 482,000 tonnes, a 68 per cent increase over the previous year.

The big problem with the 2025 harvest is that it includes an estimated 230,000 tonnes of No. 3 or sample chickpeas.

“We’re finding homes for those in the U.S., but they only need a certain amount for their pet food,” said Penner.

It doesn’t help that farmers in the United States produced their biggest chickpea crop since 2017, harvesting a little more than 300,000 tonnes.

Russia produced about 750,000 tonnes of small calibre chickpeas last year, while Mexico could harvest a record crop of large calibre chickpeas in 2026.

Argentina harvested its biggest crop since 2019-20 and could export 140,000 tonnes in 2025-26. It competes directly with Canadian product.

Canada’s exports have been above average for each of the first four months of the 2025-26 campaign as low prices buy demand in markets such as Pakistan and Bangladesh.

Penner is forecasting a record 240,000 tonnes of exports for the year.

“The problem is that’s not enough,” he said.

“Prices are still dropping.”

He thinks prices are close to bottoming out, but he hopes farmers will plant fewer chickpeas in 2026.

Even if growers reduce plantings by 12 per cent and yields return to average, total supply in 2026-27 will be 616,000 tonnes, nearly identical to this year due to the huge carryover.

Ending stocks in 2026-27 are forecast at 286,000 tonnes, similar to his 2025-26 estimate of 294,000 tonnes.

The stocks-to-use ratio would be 87 per cent next year, down slightly from 92 per cent this year. Both of those ratios are extremely high.