Lentils: Soft Prices Meet Rising Weather Risks in Key Pulse Regions

Lentil prices are currently broadly stable to slightly firm, underpinned by comfortable global pulse availability and subdued demand, while emerging monsoon and El Niño risks in India underpin medium‑term upside potential. Overall pulse markets in India remain under pressure as higher domestic availability, slow mill buying and cautious kharif sowing keep a lid on prices, but weather uncertainty and import dynamics suggest latent risk for lentils and other pulses if conditions deteriorate.

Prices

Indian pulse prices are soft overall, with moong and tur easing and only modest strength in urad despite weaker sowing progress. This broader pulse weakness limits immediate spillover support for lentils, especially as mill demand remains restrained.

In the export segment, lentil-related benchmarks indicate a predominantly sideways pattern. Canadian dried lentils (FOB Ottawa) are currently around EUR 1.35–1.40/kg for Eston and Laird green types and about EUR 2.30/kg for red football, essentially unchanged over recent weeks. Chinese small green lentils (FOB Beijing) show a mildly firmer tone, edging up to roughly EUR 1.17/kg for conventional and EUR 1.26/kg for organic product.

Supply & Demand

In India, total kharif pulse sowing stood at about 155,000 hectares by mid‑June, significantly below last year’s 273,000 hectares, with urad and tur notably lagging. Despite this, imported supplies and slow mill demand have prevented a broad-based rally, as seen in only modest gains in urad and weaker prices for tur and moong.

This combination—weak sowing but still‑comfortable nearby availability—creates a fragile balance. For lentils, the softness in related pulses suggests limited short‑term demand pull, but any sustained shortfall in kharif pulses could later redirect Indian demand to imported lentils, tightening exportable supplies, especially from Canada.

Outside India, lentil supply remains broadly adequate. Previous Canadian balance sheets point to larger carry-out stocks following strong exports, cushioning spot availability even if new-crop weather issues emerge. In the United States, growers intend to cut lentil area by around 22% year on year, indicating that North American supply growth will be more restrained in 2026/27, a factor that could matter if demand from South Asia accelerates.

Weather & Risk Factors

Indian traders are closely monitoring the June–September monsoon amid concerns that El Niño‑related conditions could reduce rainfall and hinder pulse crop establishment. Recent official seasonal guidance for 2026 points to below‑normal southwest monsoon rainfall for India overall, with increased risk of uneven distribution and dry spells that are critical for rain‑fed pulses.

Progress updates through late June and July indicate a delayed and patchy onset, with phases of stalled advancement before revival, consistent with higher intra‑seasonal variability. For pulses, including urad and tur, such variability raises yield risk even if cumulative totals approach normal later, reinforcing the possibility of tighter domestic supplies in India and higher import requirements later in the season.

Fundamentals & Market Structure

The current pulse complex in India shows clear signs of demand-side caution: millers are buying hand-to-mouth, and imported urad and chickpeas are available at competitive cost-and-freight values, helping cap domestic price rallies. Tur and moong have even slipped, reflecting comfortable near-term supplies.

For lentils, this environment translates into a fundamentally soft but potentially volatile setup. Larger North American stocks and flat FOB offers keep the market well supplied in the short run, yet downside is limited by reduced U.S. sowings and weather risk in India. Any deterioration of the monsoon or evidence of stronger Indian consumption later this year could quickly tighten the balance.

Outlook & Trading Recommendations

• Short-term (next 2–4 weeks): Expect mostly sideways lentil prices with a mild firm bias in green types, as global availability remains comfortable but Indian monsoon uncertainty curbs aggressive selling.
• Importers / buyers: Consider layering in coverage for Q4 2026 and early 2027 on price dips, especially for Canadian greens, while retaining some flexibility to respond if Indian demand strengthens sharply.
• Producers / exporters: Hold a balanced strategy—forward sell a portion of expected production at current flat prices, but maintain upside exposure in case monsoon-related supply shocks in India tighten the broader pulse complex.
• Risk focus: Monitor India’s sowing progress for urad and tur, monsoon rainfall distribution in July–September, and any policy changes on Indian pulse imports that could alter trade flows.

3‑Day Price Indication (Directional)

• FOB Canada (Ottawa) – Red & Green Lentils: Stable in EUR terms; only minor intra‑day moves expected.
• FOB China (Beijing) – Small Green Lentils: Slight upward bias after recent small gains, but overall range‑bound.
• India Domestic Pulse Complex (reference for sentiment): Mostly soft to steady, with limited spillover into lentils in the very short run but rising medium‑term weather risk.