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Indian pulse tariff is likely to impact Australian

Posted on January, 12, 2018 at 10:42 am


Three weeks on from the Indian government’s decision to impose a 30 per cent tariff on all pulse imports, the Australian pulse industry is coming to terms with the ramifications for the domestic and export markets.

Associated Grain, Dalby, trading manager Mark Schmidt said chickpeas had seen volatility over the past month in response to the implementation of the Indian import duty being introduced.

“This changed values from $700 in December back to a current price in the mid $500s in early January.”

Mr Schmidt said the tariff had been introduced to increase the local Indian values and to support the domestic price for the Indian farmers.

“India is seeing an increase in their own crop production and have also started exporting pulses, which is a first for many years.”

Mr Schmidt said the introduction of tariffs at times never returned the desired result, with India being self-sufficient for only one year in the past thirty.

“Change in Indian policy will cause long term harm to their main trading partners, which will take time to rebuild confidence and supply,” he said.

“The implementation of the duty has in fact backfired, with values dropping to a level similar to what the duty would have caused and is not returning any extra dollar return to growers in India.‚Äč”

Pulse Australia chief executive officer, Nick Goddard, said his organisation had been working closely with the Australian and Indian governments to clarify whether exports that were already en route would be subject to the tariff.

Mr Goddard said at this stage the Indian government had indicated that the first wave of 2017-18 Australian exports would not be subject to the tariff, however Pulse Australia was still working closely with the Indian government to arrange some sort of official dispensation for stock that’s already on the water.

“Having said that, we're now three weeks down since the tariff was introduced so a fair bit of stock has either been diverted since then or has arrived, so the urgency is sort of disappearing,” he said.

Mr Goddard said while the tariff may have an impact on planting intentions for this year, it was important to respect the Indian government’s decision to protect their domestic growers.

Even though the tariff was put on literally overnight, Mr Goddard said there was still the possibility that the tariff would be taken off just as quickly.

“India only has to have their current crop of chickpeas suddenly have a failure, or some disease outbreak, or something that puts a bit of risk against that crop, and the tariff could even come back or come off at a minute's notice,” he said.

Source: Queensland Country Life