Pea Market Capped by Canadian Surplus and India’s Import Duty Wall

Imported yellow peas are stuck in a narrow trading range, squeezed between heavy Canadian stocks and India’s 30% import duty, with only a weather‑driven pulse shortfall in India offering near‑term upside. Pea markets are entering mid‑May with a distinctly heavy tone. Large Canadian inventories, subdued Indian import demand and cheap domestic chickpeas in India are combining to cap any meaningful price recovery in yellow peas. Even as Australian offers soften, India’s high duty wall keeps landed costs uncompetitive and wholesale prices in key Indian centres largely flat. For European traders, India’s reluctance to absorb volumes delays any global stock drawdown and leaves international prices vulnerable to further pressure unless a supply shock or a policy shift materialises.

Prices & Spreads

Imported yellow peas in India were quoted around $44.67–44.94 per quintal in major wholesale centres for the week ending 11 May 2026, holding broadly steady despite the ongoing overhang of Canadian supply. At an indicative rate of roughly 1 USD = 0.92 EUR, this corresponds to about 0.41–0.41 EUR/kg, underlining how narrow and range‑bound the market has been in recent weeks.

In comparison, Brazil’s white lobia was quoted significantly higher at about $74.55–76.66 per quintal, or roughly 0.68–0.70 EUR/kg, pricing it out of most substitution demand where cheaper pulses suffice. Within Europe, indicative spot offers for dried peas remain stable: green peas FOB London are quoted around 1.02 EUR/kg, marrowfat peas 1.33 EUR/kg, and Ukrainian green peas FCA Odesa near 0.34 EUR/kg, with yellow peas from Ukraine around 0.26 EUR/kg, all unchanged over the past two weeks.

Supply & Demand Balance

On the supply side, Canada is facing one of its largest pea inventory overhangs in recent years. Pea stocks as of 31 March 2026 rose 84.7% year‑on‑year to 2.505 million tonnes, highlighting how last season’s crop and slower‑than‑hoped exports have combined into a substantial carry‑over. This surplus is weighing on international sentiment even though Canada’s overall pulse exports have held up relatively well, supported by South Asian and Middle Eastern demand.

However, Canada’s dominance in peas is being challenged. Russia is pushing aggressively into traditional Canadian destinations, offering competitive prices and alternative supply routes. Australia adds to the supply pool, and with Australian pea prices softening, the global picture is clearly one of abundant availability. Against this backdrop, the key question is not supply, but how quickly major importers such as India can or will absorb volumes.

On the demand side, India remains the pivotal swing buyer yet is currently acting as a brake on the global pea market. A 30% import duty on peas has sharply curtailed import volumes, even where CIF prices are attractive. Dal mills are limiting purchases and stockists remain largely absent, reflecting cautious downstream demand. With domestic chickpeas trading well below their own support price, Indian buyers see little value in paying a premium for imported yellow peas when a cheaper substitute is readily available.

Fundamentals & Policy Drivers

India’s current import regime is the central structural constraint. The 30% customs duty has effectively insulated domestic markets from the full force of global pea oversupply, but also capped upside for exporters hoping for a demand surge. Even with softer Australian prices, once the duty is added, landed peas struggle to compete with domestically produced chickpeas and other pulses. This substitution effect has been a recurring theme throughout the current marketing season.

Looking ahead, Canada’s new marketing season begins in August 2026, with sowing already underway in key provinces. Early indications suggest no meaningful contraction in planted area that would tighten supply in the near term. Unless weather‑related issues emerge, the likelihood is for continued comfortable global availability into the 2026/27 season. For Europe, that implies a sustained period where buyers can secure coverage without chasing the market higher, while sellers face persistent headwinds in reducing stock burdens.

Policy risk in India remains a major wild card. The government periodically reviews import duty levels based on domestic availability and price signals. Any reduction in the pea duty could quickly unleash pent‑up demand, drawing down Canadian and Australian stocks and tightening the global balance. Until such a change occurs, however, India’s duty wall continues to trap international pea prices in a low‑volatility, range‑bound pattern.

Weather & Substitution Outlook

The main potential catalyst for a shift in pea demand over the next four to eight weeks is India’s kharif season performance, particularly for pigeon peas. The kharif cycle, running from June to October, will unfold against the backdrop of an emerging El Niño pattern, which raises the risk of erratic monsoon rainfall and localized production shortfalls. A weak pigeon pea harvest would prompt Indian processors to look for alternative raw materials for split pulse production.

In such a scenario, imported yellow peas stand to benefit as a substitute, especially if domestic shortfalls push local prices higher relative to landed import parity even with duties in place. This substitution pathway is currently the primary upside scenario for the global pea market. Absent a weather‑driven shock or a policy shift in India, the baseline expectation remains one of comfortable supply and moderate, price‑sensitive demand through mid‑2026.

Trading Outlook

• For European buyers: Use the current period of stable prices and ample global supply to extend coverage modestly, especially for green and yellow peas, while avoiding over‑commitment ahead of India’s kharif season and potential policy adjustments.
• For exporters (Canada, Australia, Black Sea): Expect continued competition and slow stock drawdown unless India cuts import duties or suffers a material kharif‑related pulse shortfall. Focus on South Asian and Middle Eastern niches where demand remains resilient and freight/logistics advantages can be leveraged.
• For processors and food manufacturers: Consider strategic formulation flexibility between peas and alternative pulses. If pigeon pea or chickpea prices rise later in the year due to weather or policy shifts, yellow peas may become relatively more attractive in blends and plant‑protein ingredients.
• Risk watch: Monitor Indian government statements on pulse import policy and early monsoon performance indicators. Any clear signal of duty reduction or significant rainfall deficits in key pulse belts could trigger a rapid repricing in international pea values.

3‑Day Regional Price Indication (EUR)