Indian tariff suspension boosts Australian chickpeas

By Peter Hobson

CANBERRA (Reuters) -Australian desi chickpea prices rose sharply after India suspended tariffs on imports, opening the door to a revival of a trade once worth hundreds of millions of dollars.

Higher prices and increased demand from India will encourage farmers to plant more chickpeas in the coming months, said industry body Grains Australia.

India, the world's biggest chickpea consumer, on May 4 suspended tariffs until March 31 next year following a poor local harvest. Australia, the largest exporter of chickpeas, is in pole position to benefit.

"Australian exporters will be immediately positioning product for Indian ports," said Peter Wilson, chair of Grain Australia's pulse council.

With the sowing season just getting underway in Australia, "this will guarantee that a bit more is planted," Wilson said.

Australian desi chickpea prices rose from around A$810 ($535) a ton in February to more than A$900 last week in anticipation of the tariff decision.

After the announcement, prices were as high as A$1,150 a ton, a trader said.

Australia has exported on average 600,000 tons of chickpeas worth around $325 million a year in the last five years, its trade data show. Wilson said around 90% of these were desi, which are smaller and usually darker coloured than the white kabuli variety from which hummus is made.

The agriculture ministry forecast in March that farmers would harvest 732,000 tons of chickpeas in the 2024/25 season, up from 531,000 tons in 2023/24 and the most since 2021/22.

India imposed 33% tariffs on desi chickpeas in 2017 to support local farmers, later increasing them to 66%.

Around 60% of Australia's chickpea exports went to India - accounting for as much as 90% of India's chickpea imports - before the tariffs all but ended the trade.

Wilson said competition for Australian chickpeas would now increase and it was possible that India could once again take 60% of the market during the year of the tariff suspension.

The other main markets for Australian chickpeas are Pakistan and Bangladesh.

(Reporting by Peter Hobson; Editing by Michael Perry and Stephen Coates)