WA lupin resurgence

26 May, 2014 01:00 AM
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Every little win is part of improving market opportunities for Australian grains.

IT'S too early to determine the result of a decision to allow lupins for human consumption into India, according to Grains Industry Market Access Forum executive manager Tony Russell.

The trade establishment was announced in March, and has revived hopes for a potential resurgence in lupin production as an important break crop in WA broadacre rotations.

But Mr Russell said any resurgence would not happen overnight.

The legume has fallen out of favour with farmers in the past decade due to a lack of market access and limited returns, often replaced by canola which is seen as a more profitable and reliable break crop.

"Canola has become that major crop in the middle and brings good prices... whereas lupins have become a second string crop because the returns aren't good enough," Mr Russell said.

"Lupins have never provided gross margin returns like canola, even taking into account the nitrogen benefits it gives to the soil.

"The farmers I have spoken to might grow a few lupins but it won't be a big part of their cropping plan when you have canola delivering gross margin returns."

Mr Russell said while the export of lupins for human consumption to India had some potential there would need to be significant trade undertaken before it could be deemed a success.

"Every little win is part of improving market opportunities for Australian grains," he said.

"But we don't have any strong feel as to what this really means yet."

Mr Russell said lupins hadn't been widely consumed as a human food and there had been some negativity surrounding the human consumption of lupins in the past.

"The processing and the work that has been done in WA in particular has helped offset some of those concerns," he said.

"The trade is for lupins that have been dehulled and prepared for human consumption, so they aren't farmer-dressed lupins, they have to be processed in advance which is good because we get the advantage of value-adding.

"It will take a shift in habits and customs for people to start consuming what will be a new pulse product, it will taste different to field peas, chickpeas and the other pulses that the Indian's would be consuming in their pulse diets, so it is something that I can't see changing overnight.

"It is effectively building a new product into a new market.

"But in a market as big as India it wouldn't take much of a change to bring about quite a significant demand, say a five per cent of change in consumption to lupins.

"Australia is the largest exporter of lupins in the world, so it would be a very good market for Australia if you saw that change, that would almost be enough to lift that demand to one million tonnes, but how likely is that, I'm not sure."

Mr Russell said growers would need to see higher returns to encourage greater lupin plantings in WA.

"We would like to see one million tonne crops grown in WA but it won't happen unless prices push back up to $400 tonne," he said.

"We still have to see significantly improved prices for lupins and if this opportunity builds some demand that is where the price signal will come from.

"If the product is recognised for its great nutritional qualities hopefully it will be able to drive prices significantly enough to enable WA growers to see them as a much more viable option in their cropping plan.

"That is what I would love to see."

Mr Russell said the decision by Indian officials to allow the trade had been somewhat abrupt despite ongoing negotiations with State and Federal government agencies and private Australian parties.

"The last discussions were held in November last year and all of a sudden out of the blue the announcement came through the Australian embassy in New Delhi that they were going to provide a protocol to allow lupins for human consumption to enter India," he said.

"So the news was obviously very good."

Mr Russell said it was difficult to pinpoint what had prevented Indian officials from facilitating the trade earlier, but that it likely related to concerns over the effect of imports on the country's domestic pulse market.

"I think there was a bit of concern because they thought lupins would flood the market and crash the price of lupins," he said.

"It's hard to understand what the Indian authorities' motivations are in these sort of situations, but they have been very reluctant to move on any new product access into India.

"A lot of work was put in and I actually think the really positive stories that have been coming out in nutritional circles recently about the benefits of eating lupins may have influenced the decision to allow lupins into India.

"Maybe it was a recognition that it wasn't going to impact on their market."

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READER COMMENTS

Deregul8
26/05/2014 7:38:43 AM, on Farm Weekly

Indians will need to bid lupins up to over $500/t for this crop ever be competitive with canola.
andrew.sachse
26/05/2014 8:27:17 AM, on Farm Weekly

i grow lupins and i eat them all day when harvesting, what an awesome food. why are we not doing more here for ourselves.

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