With exports volume standing at 37,425 tons and value totaling at Rs 3.39 billion, lentils were rated top export items from Nepal last fiscal year. [break]
However, a quarterly trade report shows the country managed to export mere 8,578 tons of lentils worth Rs 668.2 million during the first quarter (mid-July to mid-October) of the current fiscal year 2011/12, which is less than 50 percent of what the country had managed to export in the same period last fiscal year.
"Lentils from Canada, Australia and Turkey are flooding the major markets, rapidly replacing the Nepali produce," said Sandip Agrawal, a lentil exporter. As a result, lentils have been pushed down to the sixth position in the list of top export items during the first quarter. Nepal has been exporting lentils to Bangladesh, Singapore and Middle-East.
Agrawal said demand for Nepali lentils has fallen so sharply over the last few months as some of the exporters are left with no order to work with. "I myself exported just around 500 tons of lentils during the first quarter whereas the quantity was around 1,500 tons during the same period last year," said Agrawal.
Traders said other exporting countries are supplying lentils at US$ 600-650 per ton whereas Nepali lentils cost over US$ 900-920 a ton. This difference in price proved a big deterrent, but that is not the sole reason for the slump.
According to traders, they failed due to quality reasons as well. "Nepali exporters have failed to maintain the quality matching with international standards whereas lentils supplied by exporters from other countries are of higher quality than what we supply," said Agrawal.
Nikhil Jaisani, another lentil exporter, also agreed that there have been problems with quality issues of Nepali lentils and that led to the slide in international demand for Nepali lentils. As a result, Nepali exporters in recent months were compelled to lower their prices.
"We had exported lentils at as much as US$ 1,300 a ton last year. However, we are hardly getting US$ 650 per ton this year," said Jaisani.
There are around one dozen lentil mills operating in Bhairawa, Nepalgunj and Birgunj for the purpose of exports.
And, quality of their output has remained low because none of these mills have color sorter - a lentil refining machine that costs around Rs 15 million. Color sorter, widely used by exporters in other countries, ensures better quality of lentils.
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