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Tight Supplies Indicated
January 04, 2002


Supplies of U.S. dry edible beans will be much smaller than a year ago and will stand in stark contrast to the high levels of the past several years. With the industry indicating low carryover stocks and imports traditionally small, the lower 2001 crop will leave supplies down and prices up. The short crop this year is a combination of acreage cutbacks, irrigation water shortages in some western states, and a drought that primarily hit Michigan and New York during the summer. With stocks of many classes likely to be low or exhausted by next summer, low supplies and higher prices this fall and winter will set the stage for a significant increase in area planted next spring.

The first estimate of dry bean production by class was released by USDA on December 11. As expected, output for all classes fell below a year earlier, with the biggest decline for cranberry beansdown 66 percent. Output of pinto beans, which accounts for the largest share (44 percent) of the U.S. dry bean crop, fell 20 percent. Production of navy beans plummeted 51 percent, black beans dropped 42 percent, and baby limas were cut 56 percent. Output of Great Northerns fell 17 percent as a 9-percent increase in Nebraskas yield was outweighed by reduced area harvested. Much of the cutback in navy, black, cranberry, and light red kidney beans was due to drought-induced production shortfalls in Michigan.

Three dry bean classes registered increases in 2001, including garbanzo (up 35 percent to a record 1.8-million cwt), blackeye (34 percent), and pink (1 percent) beans. While blackeye and pink bean prices are well above a year ago, prices in the chickpea/garbanzo market remain near last years weak levels, reflecting the record crop and burdensome stocks.

Production of black beans dropped 42 percent as lower yields (particularly in Michigan and New York) added to an 8-percent cut in area harvested (area planted was even with a year ago). The black bean crop hit record and near-record highs in 1998 and 1999, and the resulting burdensome stocks caused a prolonged slump in prices over the past 2 years. The current situation is now reversed, with the smallest crop since 1992 and low carryin stocks yielding the highest prices since 1989.

Total dry bean production in California is estimated to be 22 percent smaller than a year earlier and the third lowest on record. With the exception of garbanzo beans, output was lower for all major classes in 2001. Lima, blackeye, and garbanzo beans account for most of the states output. Limas have been the traditional leaders in the state, but markets for both have been under pressure the past 2 years. Output of baby limas, hurt by a dwindling export market, dropped 56 percent in 2001, while large limas, suffering from weak domestic demand, fell 29 percent. Aggregate California dry bean grower prices averaged $31.50 per cwt in Novemberup 18 percent from a year ago.

Exports Up Through September

U.S. dry edible bean export volume for January to September was up 14 percent from the same time a year earlier. Black (up 115 percent), light red kidney (98 percent), navy (28 percent), and pinto beans (22 percent) led the increase. Imports (excluding guar seeds) during this time were up 34 percent, led by pinto (up 208 percent) and light red kidney (149 percent) beans. Greater shipments to Mexico (up 115 percent) and the United Kingdom (U.K.) (70 percent) have been the driving force behind dry bean exports in 2001.

Reflecting higher prices and reduced stocks, September dry bean export volume declined 25 percent from a year earlier. The leading market for dry beans in September was Mexico, accounting for 43 percent of total volume.

Figure 1. U.S. dry beans, all:
Monthly grower prices

Source: USDA, NASS.

Pinto Crop Down, Prices Up

Pinto bean output is estimated to have declined 20 percent to 8.6 million bags (cwt)the smallest crop since 1993. Area harvested was down 22 percent but was partly offset by higher average yields (up 4 percent to 17.1 bags per acre). Output was down in 11 of 15 states with North Dakota, the leading producer, down just 6 percent to 4.1 million cwt.

With production down, pinto stocks will be drawn lower which will add strength to grower and wholesale prices. Grower prices (CO/NE) began the marketing year in September at $21.00 per cwtup 79 percent from the extreme lows of a year earlier. Prices in North Dakota-Minnesota had climbed to $21.50 by mid-December  the highest average price for that month since 1993. The reduction in stocks and higher prices will likely set the stage for a substantial increase in area and production in 2002.

Pinto bean exports were relatively strong for much of the first three quarters of 2002. Pinto bean export volume began to slow in Septemberlikely a reaction to rising prices and uncertainty over the quality and quantity of the new crop. However, since January, increased movement to Mexico (up 106 percent), Angola (26 percent), and Haiti (4 percent) pushed pinto bean exports up 22 percent from a year earlier. These three nations accounted for 78 percent of U.S. pinto volume shipped overseas. Exports are expected to account for about 12 percent of supplies during calendar 2001up from 10 percent in 2000 and the same as the average share during the 1990s. The recent low was in 1992 when just under 7 percent of supplies were exported.

The U.S. traditionally imports few pinto beans but volume (largely from Canada) has been on the rise the past few years. In the previous 3 years, pinto exports have averaged 18 million poundsabout 2 percent of domestic consumption. Imports this year are expected to total about 30 million pounds3 percent of domestic consumption.

Navy Crop Smallest Since 1921, Prices Rise

Navy (pea) bean production in 2001 has been reduced for the second consecutive year. Navy bean production was down 51 percent to 2.3 million cwtthe smallest crop since 1921. Output was down in every state with the traditional leader, Michigan, suffering a near-total crop loss due to severe drought. Navy production in Michigan was slashed 91 percent as acres harvested fell 75 percent and average yield declined 62 percent. In North Dakota, despite 7 percent higher yields, lower area harvested pushed navy bean production down 18 percent.

The smaller crop means pea bean stocks entering the 2002 season should be substantially reduced. As a result, pea bean prices have strengthened and should continue to do so as the marketing year progresses. Michigan navy bean grower prices began the marketing year in September at $18.25 per cwtup 73 percent from the rock bottom lows of a year earlier. Prices had climbed to $23.50 by mid-Decemberthe highest for that month since 1994. The reduction in stocks and higher prices will likely set the stage for a substantial increase in area and production in 2002.

Navy bean exports have been strong this year, with volume during the first 9 months of the year up 28 percent from a year earlier. Increased movement to the U.K. (up 116 percent), New Zealand, Mexico, and Italy outweighed reduced movement to Canada (down 74 percent) and South Africa. Exports are expected to account for about 30 percent of supplies, up from 21 percent in 2000 and 24 percent during the 1990s. The recent low was in 1992 when just 14 percent of supplies were exported.



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