Chickpea futures at the NCDEX were firmer again overnight closing up about AUD$11.00 per tonne in the January contract when taking currency into account. Combine this with the move higher of roughly AUD$18 on Monday night and it’s becoming apparent that the tariff on yellow peas in actually inflating the price of domestic pulses in India and as long as a tariff is not put on chickpeas this should in theory support export values for Australia product.
I say in theory because when you are dealing with this particular market white is sometimes black and up is sometimes down, depending on whether the buyer is in the money or out of the money.
The worst news of the night came out of Egypt. A court ruling said that the prime minister was not legally authorised to issue last years decree that returned the ergot level in imported wheat to 0.05% from 0%. This effectively means that wheat destined for Egypt could in fact be rejected if any ergot at all is found in the sample. Last year when Egypt decided to change from international standards of 0.05% to 0% the number of participants active in tenders fell dramatically and at the end of the day decision to use 0% tolerance had no more effect than to actually inflate the price of wheat destined to Egypt. So is it off to the high court or does the whole Egyptian wheat debacle start afresh. In the meantime it is likely that EU traders, those most affected by the 0% standard will withdraw from future tenders. This may equate to higher EU wheat stocks come spring.