Volatility Returns

Weather disrupts 2019 dry edible bean crop

Unprecedented. Disastrous. Stressful.

These are just some of the words that have been used to describe the 2019-2020 dry edible bean harvest. Just a couple of months ago everything was fine and dry bean prices had been steady although depressed. Then mother nature stepped in and delivered a relentless barrage of snow, continuous rains, warm temperatures, hail, and a deep freeze across the biggest dry edible bean producing states from North Dakota to Minnesota and Nebraska.

For several weeks, between late September thru November many dry bean dealers were “off the board” while the market evaluated the extent of the crop damage from bad weather. As the news began to spread dry bean participants began to realize things had gone from bad to worst to disastrous very quickly. Concerns about supply and demand started weighing on the market as prices reacted with a bump up, then a jump, and finally spiking. Pinto beans were the variety which had the most volatile reaction in terms of pricing. Wet weather has discolored much of the pinto harvest this year. For much of the 2018-2019 crop year, slow dark pintos did not receive a premium in the market versus conventional pinto and for that reason many growers decided not to plant the slow dark variety this year which turned out to be a bad move for those who didn’t.

This year light colored pinto beans will receive a premium in the marketplace. The question is though, how much will end users be willing to pay? It has been a long time since the market has seen pinto bean prices this high and consumers have been used to lower prices for quite sometime now. Will consumption slow? Where’s Mexico? Can we expect prices to go higher from here? The answer is probably, waiting, and they could. This is scary stuff people, if you need a minute to change into a clean set of your Duluth Trading underwear go for it.

Even the USDA is having a hard time finding out where prices stand as many dealers are reluctant to provide firm numbers. Last time I checked, not available (NA) seemed to be the most consistent offer by dealers, and those who are offering beans have adjusted pricing much higher.

What happens from here, no one really knows. The only thing for certain is volatility has returned to the dry edible bean market and participants will need to adjust.

United States Department of Agriculture Crop Production

USDA CROP PRODUCTION UPDATE

Dry Edible Bean Area Planted and Harvested, Yield, and Production – States and United States:

2014 and Forecasted August 1, 2015

———————————————————————————————–

:   Area planted    :  Area harvested   : Yield per acre 1/ :   Production 1/

State     :——————————————————————————-

:  2014   :  2015   :  2014   :  2015   :  2014   :  2015   :  2014   :  2015

———————————————————————————————–

: ———— 1,000 acres ————    —- pounds —    — 1,000 cwt —

:

Arizona …….:    11.0       9.0      10.9       8.9    1,940     1,950       211       174

California ….:    48.0      43.0      47.5      42.5    2,190     2,300     1,040       978

Colorado ……:    46.0      46.0      44.0      43.0    1,900     1,700       835       731

Idaho ………:   125.0     130.0     124.0     129.0    1,800     1,700     2,232     2,193

Kansas ……..:     7.5       8.0       6.9       7.5    1,710     1,900       118       143

Michigan ……:   250.0     250.0     245.3     246.0    1,940     1,900     4,749     4,674

Minnesota …..:   155.0     190.0     148.0     182.0    1,950     2,000     2,887     3,640

Montana …….:    37.5      46.0      37.0      45.0    1,630     1,800       603       810

Nebraska ……:   165.0     150.0     152.0     139.0    2,500     2,400     3,800     3,336

New Mexico ….:    10.5      12.5      10.5      12.4    1,900     2,100       200       260

:

New York ……:     8.0       8.0       7.7       8.0    1,490     1,900       115       152

North Dakota ..:   630.0     650.0     615.0     635.0    1,430     1,400     8,795     8,890

Oregon ……..:     8.5      10.0       8.5      10.0    2,260     2,300       192       230

South Dakota ..:    14.0      12.0      12.9      11.2    1,880     2,050       243       230

Texas ………:    23.0      29.0      21.0      26.0    1,220     1,050       256       273

Washington ….:   130.0     120.0     129.0     119.0    1,500     1,500     1,935     1,785

Wisconsin …..:     7.9       7.9       7.9       7.9    2,480     2,500       196       198

Wyoming …….:    42.0      31.0      37.6      29.5    2,130     2,000       799       590

:

United States .: 1,718.9   1,752.4   1,665.7   1,701.9    1,753     1,721    29,206    29,287

———————————————————————————————–

1/ Clean basis.

 

Dry Edible Bean Area Planted by Commercial Class – States and United States:

2014 and Forecasted August 1, 2015

——————————————————————————-

Class and State  :  2014  :  2015  ::    Class and State  :  2014  :  2015

——————————————————————————-

:   1,000 acres   ::                     :   1,000 acres

:                 ::                     :

Large lima          :                 :: Light red kidney    :

California ………:   8.1     10.7  :: California ………:   1.9      0.9

:                 :: Colorado ………..:   5.6      8.0

Baby lima           :                 :: Idaho …………..:   1.7      2.1

California ………:  14.9      5.9  :: Michigan ………..:  11.3      9.1

:                 :: Minnesota ……….:  17.2     23.7

Navy                :                 :: Nebraska ………..:  12.2     22.0

Idaho …………..:   1.5      2.5  :: New York ………..:   3.7      3.2

Michigan ………..:  82.0     69.0  :: Oregon ………….:   0.9      0.9

Minnesota ……….:  50.4     47.6  :: Washington ………:   3.6      2.3

Nebraska ………..:    1/      0.8  ::                     :

North Dakota …….: 107.0    104.0  :: United States ……:  58.1     72.2

Oregon ………….:    1/      1.0  ::                     :

South Dakota …….:   5.2      1.2  :: Dark red kidney     :

Washington ………:   1.1      0.8  :: California ………:   1.4      3.0

Wyoming …………:   0.5      1.0  :: Idaho …………..:   1.5      1.8

:                 :: Michigan ………..:   3.3      4.2

United States ……: 247.7    227.9  :: Minnesota ……….:  39.9     55.5

:                 :: New York ………..:   1.4      2.4

Great northern      :                 :: North Dakota …….:   1.7      3.1

Idaho …………..:   4.0      4.1  :: Oregon ………….:    1/      0.8

Nebraska ………..:  76.0     36.0  :: Washington ………:   3.5      3.1

North Dakota …….:  10.3      4.8  :: Wisconsin 2/ …….:   6.6      7.9

Wyoming …………:  13.5      2.0  ::                     :

:                 :: United States ……:  59.3     81.8

United States ……: 103.8     46.9  ::                     :

:                 :: Pink                :

Small white         :                 :: Idaho …………..:   6.0      6.7

Idaho …………..:   2.3      1.8  :: Minnesota ……….:   4.3      4.2

Oregon ………….:    1/      1.4  :: North Dakota …….:  11.1      9.6

:                 :: Oregon ………….:    1/        –

United States ……:   2.3      3.2  :: Washington ………:   1.0      0.5

:                 ::                     :

Pinto               :                 :: United States ……:  22.4     21.0

Arizona …………:   4.8       1/  ::                     :

Colorado ………..:  35.0     32.0  :: Small red           :

Idaho …………..:  19.0     25.0  :: Idaho …………..:   8.0     10.0

Kansas ………….:   5.5      6.3  :: Michigan ………..:  20.0     25.1

Michigan ………..:   2.0      2.0  :: North Dakota …….:   2.7      7.4

Minnesota ……….:   9.8     11.0  :: Washington ………:   4.0      6.6

Montana …………:   6.0      5.0  ::                     :

Nebraska ………..:  71.0     83.0  :: United States ……:  34.7     49.1

New Mexico ………:  10.5     12.5  ::                     :

North Dakota …….: 404.0    363.0  :: Cranberry           :

:                 :: California ………:   0.8      0.4

Oregon ………….:   1.0      2.0  :: Michigan ………..:   4.0      5.3

South Dakota …….:   2.9      2.4  ::                     :

Washington ………:  12.0     11.7  :: United States ……:   4.8      5.7

Wyoming …………:  24.8     23.0  ::                     :

:                 ::                     :

United States ……: 608.3    578.9  ::                     :

——————————————————————————-

See footnote(s) at end of table.                                    –continued

 

Dry Edible Bean Area Planted by Commercial Class – States and United States: 2014 and Forecasted

August 1, 2015 (continued)

———————————————————————————————————

Class and State      :   2014    :   2015    ::       Class and State      :   2014    :   2015

———————————————————————————————————

:      1,000 acres      ::                            :      1,000 acres

:                       ::                            :

Black                      :                       :: All chickpeas (Garbanzo)   :

Idaho …………………:      1.4         3.5  :: California …………….:      9.3         7.7

Michigan ………………:    120.0       128.5  :: Idaho …………………:     74.0        70.0

Minnesota ……………..:     23.4        35.2  :: Montana ……………….:     31.5        41.0

Nebraska ………………:      3.7         4.0  :: Nebraska ………………:        –         0.2

New York ………………:      1.9         1.6  :: North Dakota …………..:      6.4         7.7

North Dakota …………..:     80.0       142.0  :: Oregon ………………..:      1.1         1.0

Oregon ………………..:      0.8         1.3  :: South Dakota …………..:      2.8         4.3

Washington …………….:      5.0         6.3  :: Washington …………….:     90.0        84.0

:                       ::                            :

United States ………….:    236.2       322.4  :: United States ………….:    215.1       215.9

:                       ::                            :

Blackeye                   :                       :: Other                      :

Arizona ……………….:      2.4          1/  :: Arizona ……………….:      3.8         9.0

California …………….:      6.4         8.2  :: California …………….:      5.2         6.2

Texas …………………:     21.5        27.5  :: Colorado ………………:      5.4         6.0

:                       :: Idaho …………………:      5.6         2.5

United States ………….:     30.3        35.7  :: Kansas ………………..:      2.0         1.7

:                       :: Michigan ………………:      7.4         6.8

Small chickpeas (Garbanzo, :                       :: Minnesota ……………..:     10.0        12.8

smaller than 20/64 inches) :                       :: Montana ……………….:        –           –

Idaho …………………:     29.0        32.0  :: Nebraska ………………:      2.1         4.0

Montana ……………….:      (D)         (D)  :: New York ………………:      1.0         0.8

North Dakota …………..:      2.0         5.3  :: North Dakota …………..:      6.8         8.4

Oregon ………………..:      (D)         (D)  ::                            :

South Dakota …………..:      (D)         (D)  :: Oregon ………………..:      4.7         1.6

Washington …………….:     22.0        28.0  :: South Dakota …………..:      3.1         4.1

:                       :: Texas …………………:      1.5         1.5

Other States 3/ ………..:     13.8        16.0  :: Washington …………….:      9.8         4.7

:                       :: Wisconsin ……………..:      1.3           –

United States ………….:     66.8        81.3  :: Wyoming ……………….:      3.2         5.0

:                       ::                            :

Large chickpeas (Garbanzo, :                       ::                            :

larger than 20/64 inches)  :                       :: United States ………….:     72.9        75.1

California …………….:      9.3         7.7  ::                            :

Idaho …………………:     45.0        38.0  :: All dry edible beans       :

Montana ……………….:      (D)         (D)  :: United States ………….:  1,718.9     1,752.4

Nebraska ………………:        –         0.2  ::                            :

North Dakota …………..:      4.4         2.4  ::                            :

Oregon ………………..:      (D)         (D)  ::                            :

South Dakota …………..:      (D)         (D)  ::                            :

Washington …………….:     68.0        56.0  ::                            :

:                       ::                            :

Other States 3/ ………..:     21.6        30.3  ::                            :

:                       ::                            :

United States ………….:    148.3       134.6  ::                            :

———————————————————————————————————

–   Represents zero.

(D) Withheld to avoid disclosing data for individual operations.

1/  Data are included in the “Other” class to avoid disclosing data for individual operations.

2/  Includes some light red kidney to avoid disclosure of individual operations.

3/  Includes data withheld above.

2014 Dry Edible Bean Production USDA Forecast

Dry beans: Production of dry edible beans is forecast at 28.7 million cwt, up
17 percent from last year. Planted area is estimated at 1.67 million acres,
up 23 percent from 2013. Harvested area is forecast at 1.61 million acres,
23 percent above the previous year. The average United States yield is
forecast at 1,784 pounds per acre, a decrease of 83 pounds from a year ago.

In North Dakota, planting was virtually complete by June 22, well ahead of
last year but equal to the 5-year average. As of August 3, development
remained behind the normal pace. In Nebraska, planting was virtually complete
by June 22, near the normal pace. By early-August, the crop was rated mostly
good to excellent. Michigan’s planting began ahead of schedule and was
finished by the end of June. Conditions have been favorable for the crop and
by August 1 the crop was rated 75 percent good to excellent.

Fundamentally speaking, things look good due to favorable weather conditions and more acres in most parts. Prices should decline to lower levels on certain varieties of beans and pulses when new crop starts shipping out into the market. Growers and shippers of  certain colored varieties like Great Northerns and Red Kidneys will have a larger supply this year in hopes seeing last year’s high values again. There will be a larger supply of pinto beans this year along with a variety of color options, and the higher number of CWT produced in North Dakota & other pinto bean growing regions should drive prices to lower levels growers won’t be satisfied with.