Glimmers of Hope for Peas

A couple of very large clouds have been looming over the Canadian pea market in recent months and added a lot of risk to the market outlook. The Canadian market was especially vulnerable as the “clouds” refer to two major importers that together, have accounted for roughly three-quarters of total Canadian pea exports so far in 2024/25.

The first cloud showed up very unexpectedly in March, when China suddenly announced 100% import tariffs on peas, as well as other agricultural products. Those tariffs took effect almost immediately and caused huge concern. Up to that point in the 2024/25 marketing year, China was the destination for 30% of both yellow and green peas from Canada. A loss of 30% of the market is serious and caused an immediate sharp drop in bids across the prairies.

The second cloud for Canadian peas has been lurking on the horizon for much longer. In late 2017, India imposed 50% tariffs and volume restrictions on yellow pea imports, which essentially shut down that trade. This situation lasted until late 2023 when tariffs were reduced to 0%, but that reprieve always had a deadline attached. Since then, the deadline has been extended numerous times, sometimes only a couple of months at a time, which still discouraged active trade. The latest deadline was May 31, 2025. So far in 2024/25, India has accounted for 47% of Canadian yellow pea exports, which makes the possibility of tariffs a critical concern.

The recent tariffs from China and the potential for India to reimpose tariffs has been keeping a damper on the Canadian pea market, with an even greater impact possible for 2025/26. Recently though, those situations have become less threatening.

Last week, India announced another extension to the zero tariffs on yellow peas, but this time the deadline is longer, scheduled for March 31, 2026. This “extended extension” is good news because it reaches well into the 2025/26 marketing year and allows trading of new-crop peas. While this is positive, it’s not going to trigger a huge flood of Canadian peas moving into India in the short-term.

The chart shows that Indian purchases have already been very quiet in the past few months, as importers there are still sitting on large inventories of imported peas brought in earlier. In addition, those sizable inventories have weighed on pea prices in India and buyers there aren’t willing to pay more for Canadian peas, just to lose money. At some point, those Indian stockpiles of peas will get worked lower, prices will recover and trade will resume in a bigger way, but that will likely be a few months off.

The chart of monthly pea exports also reveals something very interesting about the Chinese trade situation. Remember that China’s 100% tariffs on Canadian peas took effect in March 2025, but curiously, Canada managed to export 170,000 tonnes of peas to China in April, most of which were yellow peas. We’re not quite sure how or why that happened, but if this means further exports to China are possible in the coming months, it’s certainly a positive sign.

Just a few weeks ago, when we were updating our Canadian pea supply and disposition tables for 2024/25 and 2025/26, the outlook was quite concerning. The worst-case scenario, with both India and China stopping imports, was bleak with the potential for burdensome supplies and lower prices. At the same time though, we suggested that if one or both of these trade situations were resolved, the outlook could look very different. Now it seems a few rays of light are shining from behind the clouds.

Pulse Market Insight provides market commentary from Chuck Penner of LeftField Commodity Research to help with pulse marketing decisions.