Aussie Farmers to Increase Chana Production for Indian Market

Aussie farmers to increase chana production for Indian market

India’s decision to eliminate the 40% import duty on desi chana has led to a 7-10% increase in global prices of the commodity within one day of the announcement on Friday. This strategic move, coinciding with the current sowing season in Australia, is expected to encourage Aussie farmers to expand both the acreage and production of Bengal gram for export to India.

According to a source, Aussie farmers are expected to continue sowing chana until the end of May. The recent decision by India to eliminate import duties is likely to incentivize them to plant more chana to meet the demand from Indian consumers.

However, the report also mentioned that some members of the pulses industry believe that the removal of import duties on desi chana could discourage Indian farmers from planting chana in the upcoming season, leading to a potential increase in India’s dependence on imports.

India recently eliminated the 40% import duty on desi chana and extended the duty-free import of yellow peas. Consequently, international prices rose to $800 per tonne on Saturday, compared to the previous range of 720-750 per tonne.

An insider noted that Australian chana is expected to be introduced to the Indian market starting in November, overlapping with India’s rabi sowing season.

While the Centre has estimated India’s chana production for 2023-24 to reach 12 million tonnes, trade estimates indicate a figure closer to 8 million tonnes, falling short of India’s demand, which exceeds 9 million tonnes. India is anticipated to import chana from Tanzania post-August, followed by imports from Australia, the report said.

However, the industry is surprised by the government’s choice to prolong the duty-free import of yellow peas until October, considering that trade estimates indicate around 1.8-2 million tonnes of yellow peas have already been imported into the country.’

The ET quoted pulses processor Nitin Kalantry as saying that both decisions have been made considering the shortfall in the domestic market and the welfare of consumers.