Cheap chickpeas spur Indian buyers to default on cargoes

Indian buyers of chickpeas from top exporter Australia are defaulting on cargoes or trying to renegotiate prices after an influx of supply, according to Bloomberg.

A bumper Australian crop has dragged down prices in India, making existing contracts unattractive, people familiar with the matter said. Contracts for as much as 15 per cent of the total estimated cargoes booked for delivery between November and March -- equivalent to roughly 225,000 tonnes of chickpeas -- are affected, said the people, who asked not to be named as the talks are confidential.

India’s move last year to scrap an import levy on chickpeas prompted farmers in Australia to boost planting. Production there is forecast to more than triple versus last season, according to government data. The country’s shipments of dried, shelled chickpeas to India in the second half of 2024 came to 1.1 million tonnes, nearly double the amount sold in the prior fiscal year. The influx has caused prices in India to sink, however, with a more than 30 per cent drop between September and January, one of the people said. Higher shipments of yellow peas, a substitute, from Canada and Russia are also adding to the problem.

That steep fall has prompted some buyers to attempt to get out of existing contracts. Some of the people said contracts for delivery to Pakistan had also been impacted.

India consumes more pulses than any other country in the world. Peas, lentils and beans are an important part of Indian cuisine and the main source of protein for hundreds of millions of vegetarians in the world’s most populous nation.