Chickpeas (Chana) Stay Firm as Mill Demand Rises Despite Record Crop

Chickpeas prices are holding firm in early June, supported by increased mill demand, lower mandi arrivals and constrained imports, despite record production estimates. Government procurement and higher import costs are tightening open-market availability, keeping chana and Kabuli chickpea values well above previous levels. The domestic pulses complex in India has turned more constructive at lower price levels, with chana moving in tandem with arhar and urad while imported masoor remains an underperformer. Need-based buying from dal and besan mills has picked up after the recent correction, and traders report that cautious but steady demand is emerging as the monsoon onset and festival period approach. With IMD signalling a below-normal overall monsoon but a broadly normal start, the market is closely watching rainfall distribution, import flows and the pace of government stock releases.

Prices & Spreads

FOB and FCA indications for Indian chickpeas in New Delhi have edged higher over the past three weeks, reflecting firm domestic fundamentals and stronger mill demand. Larger-sized Kabuli-type lots are commanding a clear premium over smaller calibres, and Mexican origin remains the most expensive option on the export side.

Note: USD-denominated offers around 0.90–0.96 USD/kg for Indian origins and 1.15 USD/kg for Mexican origin have been converted to EUR using ~1.07 USD/EUR. Domestic wholesale prices for chana and chana dal in India’s spot mandis are aligned with these export equivalents, and recent data show modal Kabuli chickpea prices above EUR 0.80/kg in key central Indian markets. 

Supply & Demand

India’s pulses complex is showing a mixed but gradually improving demand profile. For chickpeas, mills have stepped up purchases after a period of price weakness, particularly for chana dal and besan. Lower arrivals in producing mandis and limited imported supply are underpinning sentiment, even though official estimates still point to record chana production this season.

Government procurement has absorbed a meaningful share of the crop, reducing the volume available in the open market and preventing the deep price correction some buyers had expected. At the same time, imports of yellow peas and chickpeas have been lower than in previous years, increasing reliance on domestic inventories. This tightness contrasts with masoor, where imported stocks remain heavy and prices relatively weak, reinforcing chana’s relative price strength within the pulses basket.

Fundamentals & Weather

Fundamentally, the key driver is the gap between record production on paper and the actual flow of stocks into trade channels. Traders consistently highlight that open-market supply of chana feels less comfortable than headline production numbers imply, due to procurement operations and cautious farmer selling. Need-based mill buying is prominent, with processors avoiding aggressive forward coverage but forced to re-enter the market on price dips.

On the weather side, IMD’s updated long-range forecast points to a below-normal southwest monsoon for June–September 2026, at roughly 90–92% of the long-period average.  Early-June updates show the monsoon has reached southern and northeastern India, with active spells but also warnings of hotter-than-normal conditions in parts of central and northwest India.  For chickpeas, the immediate impact is limited because the current crop is already harvested; however, moisture conditions and input costs during the upcoming rabi sowing window will influence 2026/27 chana acreage and thus medium-term supply expectations.

Market Drivers & Risks

• Mill demand improving: Dal and besan manufacturers have resumed buying at lower levels, providing a solid demand floor after recent price declines in pulses.
• Lower arrivals, tight open-market stocks: Mandi inflows in key chana-growing regions are slowing seasonally, while government procurement limits free stocks and supports prices.
• Import economics: Higher landed costs and reduced imports of yellow peas and chickpeas keep domestic chana competitive; Mexican Kabuli maintains a premium, capping downside for Indian large-calibre supplies.
• Weather and monsoon risk: A below-normal monsoon could raise concerns over future pulse acreage and yields, adding a weather risk premium if rainfall deficits materialise in major producing belts.
• Substitution within pulses: Weak imported masoor prices offer some substitution potential on the demand side, but strong culinary demand for chana dal and besan, especially into the monsoon and festive season, should keep chickpea usage resilient.

Short-Term Outlook & Trading Ideas

In the near term, the chickpeas market is expected to remain supported but range-bound, with the upside capped by cautious mill purchasing and the downside limited by constrained arrivals and import parity. As monsoon showers advance and seasonal consumption picks up, the demand profile for chana dal and besan should strengthen further, especially if festival-related buying emerges on schedule.

• Importers / Traders: Consider maintaining moderate long exposure in Indian origins, particularly mid-to-large calibres, on price dips. Avoid aggressive short positions given tight open-market stocks and uncertain monsoon developments.
• Millers / Processors: Use current consolidation to secure partial coverage for the next 4–6 weeks rather than relying solely on spot. Focus on flexible contracts that allow for quality and size mix adjustments.
• End-users / Food manufacturers: Lock in a share of forward needs for chickpea-based products while spreads between Indian and Mexican origins remain historically wide; diversify origins where logistics permit to mitigate potential weather and policy shocks.

3-Day Directional View (Indicative)

• India (New Delhi, FCA/FOB, all calibres): Slightly firm bias in EUR terms as local demand and limited arrivals support prices; intraday volatility but trend mildly upward.
• Mexico (FOB, large Kabuli): Largely stable at a clear premium to Indian origin; no major change expected in the next three days.
• Indian domestic mandis (Desi & Kabuli, spot INR, viewed in EUR): Steady to firm with localized gains in consumption hubs, tracking improving mill buying and early monsoon sentiment.