Exporting dried lentils grains to Europe

Lentils are a part of an ethnic and traditional cuisine. However, there are growth opportunities for lentils throughout Europe. This is because of product development in the grains and pulses industry and strengthening of the health food sector. For exporters in developing countries it is important to be competitive in trade volumes and price, or try to differentiate in specific varieties or niche markets.

1. Product description

The lentil (Lens culinaris) is an edible pulse of the legume or Fabaceae family. The seeds are lens-shaped and grow in short flat pods. Lentils are available in various shapes, sizes and colours.

Common lentil varieties include:

• the green lentil,
• the French lentil or lentilles du Puy,
• the red or Egyptian lentil, and
• the yellow lentil.

The green, French and yellow lentils are usually sold with the seed coat on. The red lentil is rounder, smaller and marketed without the seed coat attached.

Lentils have a long history as a food source, originating in the Near East. The high level of protein and iron makes them a nutritious crop and ideal for vegetarian diets.

In the international Harmonized Commodity Description and Coding System, lentils are registered under a specific statistical number (see table 1).

Table 1: Combined Nomenclature (CN) Code for Lentils

Statistical Number	Product
07.13.40.00	DRIED, SHELLED LENTILS, WHETHER OR NOT SKINNED OR SPLIT

Source: Eurostat (Comext)

2. What are the main developments on the European market for dried lentils?

Consumption in Europe offers room for growth

Europe is a relatively small consumer of lentils from a global perspective. Less than 5% of the world’s production is processed or consumed in Europe.

The consumption of lentils in Europe is gradually increasing, indicated by increasing import and production. This growth is largely due to a rise in the size of the ethnic community, but also to the fact that more non-ethnic consumers now consider lentils to be a nutritious and healthy food and part of a varied diet. As a current or new supplier you can benefit from this increasing consumption.

European market for lentils grows with increased prices

The total import volume from non-European Union countries is approximately 200 thousand tonnes. In 2017, import volume increased to 246 thousand tonnes, but import value had already been growing since 2015. The higher price for lentils is a result of a strong growing demand elsewhere, such as India, which drives up the price of lentils.

Imports from developing countries, however, have remained stable, while Canada, the USA and Turkey have benefitted the most from the recent growth in European demand.

Spain and Italy are the largest importers of lentils

Lentil consumption is highest in the Mediterranean region, where Spain (75 thousand tonnes) and Italy (49 thousand tonnes) were the main importers in 2017. Canada and the USA are their main suppliers.

Spain has a market for different lentil varieties such as brown lentils, large and medium-large green lentil varieties (including two of their own protected varieties, Lenteja de la Armuña and Lenteja de Tierra de Campos). The volume and variety of lentils makes the country a good starting point if you are a new supplier.

Lentils have been part of the diet for centuries in Italy. Traditionally served on New Year’s Eve, lentils are believed to bring good luck and prosperity in the coming year.

A dynamic demand with direct trade relations

Each country has its own preferences and European importers prefer to buy from large and reliable suppliers directly from origin. This means as an exporter you can find opportunities in practically every European country. In Germany there is an increasing consumption of lentils, partly due to a growing community of ethnic consumers, but also because of an expanding group of vegetarians and health-conscious consumers. Lentil soup (‘linsensuppe’) is also a common German dish.

The United Kingdom is also a relatively large consumer, due to the presence of a large Indian community (1.5 million people). Lentils are known as dal in Indian cuisine, in which they are a staple food. Ethnic Indian retail in the UK is difficult to reach if you are not an Indian supplier or brand of lentils. The best chances to reach the Indian community in the UK are through specialised importing distributors that have their own brand or packing facilities.

France is known for their lentils du Puy, a local variety valued for its high quality. In December 2016, the French food agency ANSES updated the recommended dietary guidelines, putting more emphasis on the consumption of pulses and lentils in particular. This could give a new impulse to French lentil consumption.

As a new supplier you could also explore smaller, but fast-growing import markets, for example Poland, Sweden and Portugal. These countries each imported between 92% and 127% more lentils in 2017 than five years prior.

Belgium is an important trader of lentils within Europe

Around 11 of the 14 thousand tonnes of imported lentils in Belgium, are re-exported within Europe. This makes Belgium a trade hub for overseas suppliers. The main destinations of Belgian lentil export are France, Germany and the Netherlands.

Spain and France export a significant amount of their local lentil production.

Spain and France produce lentils for their local market

With a production volume of 66 thousand tonnes in 2017, Europe is a relatively small producer of lentils. Around 70% of European production volume occurs in Spain (24 thousand tonnes) and France (22 thousand tonnes). The lentils that Spain and France produce are mainly destined for their national markets, making them the leading consumers of lentils in Europe. For you, as an exporter from a developing country, these markets offer opportunities because of their market size, but you must not underestimate the competition from local production and varieties.

Bulgarian lentil production shows the most growth in the EU. Lentils are a good option for farmers in Bulgaria to get ‘green direct payments’, a greening support programme of the European Union with financial benefits that contributes to the environmental protection and diversity.

New initiatives include the first commercial production of lentils in the United Kingdom, aiming achieve a British grown supply and a finer taste than mass imported lentils. Additionally, in Sweden, an investigative project to increase the production of organic lentils should benefit local organic farmers in responding to the growing demand for organic and legume based food.

3. Which trends offer opportunities in the European market for lentils?

Lentils as a vegetarian and health food

A growing number of consumers in Europe are increasingly aware of the need for a healthy diet. Online media and food specialists promote the benefits of health foods and so-called superfoods (foods claimed to have outstanding health characteristics).

Lentils are considered to be a useful component of a varied diet because of their high nutritional value. The high levels of protein and iron make them very suitable for vegetarians. Lentils are also a very good option for people with diabetes, thanks to their “slow” carbohydrates.

The countries with the largest demand for healthy plant proteins are likely to be Germany, Austria, Italy and the United Kingdom, where supposedly 9% to 10% of consumers follow a vegetarian diet. In Switzerland, this share is even bigger: vegetarians make up 11% of consumers.

Organic is a growing niche

Increased attention to health, environmental and social responsibility is leading to rapid growth of the organic sector. Many grains and pulses, including lentils, are also available as organic products.

Producing organic lentils can be an interesting option if you target the European market, because there is not enough supply available to meet the growing demand.

Ethnic food on the rise

The growth of ethnic populations in Europe has led to a rise in the use of dried lentils in Europe. But many non-ethnic European consumers are also prepared to try “new” products or recipes.

The Indian population in the United Kingdom is noted for its high consumption of lentils. Therefore the United Kingdom can be a stable market for international suppliers. In addition, the recent influx of immigrants from the Middle East, especially Syria, and North Africa, also stimulates the demand for lentils.

Convenience in cooking

Time has become a precious asset in the modern lifestyle of European consumers. The advantage of lentils compared to most dried pulses is that they don’t need to be soaked before cooking. Thus they are more likely to be adopted by consumers and food processors as a convenience ingredient.

Canned lentils offer even greater convenience, though purists might argue that the quality is less than home-cooked. Consumers that have a preference for pure and natural products will choose dried lentils over pre-cooked and canned lentils.

Lentils as an ingredient

The variety of food products and mixes available on the European market is growing rapidly.

Lentils are an interesting ingredient for new products in this expanding market. They are used in soups and salads, but also combine well with other bulk products, such as grains. More and more product mixes of lentils with grains, such as rice, quinoa or bulgur, are being developed.

In Germany, lentils and other pulses are increasingly used as a gluten-free alternative for grains and grain flours, doubling the amount of grain-free flour product launches from 2014 to 2016.

The British supermarket Marks & Spencer launched the most lentil containing products (119) in Europe between 2007 and 2016.

4. What requirements must dried lentils comply with to be allowed on the European market?

What legal and non-legal requirements must your product comply with?

Food safety

To export lentils to Europe you have to deal with a strict rules and obligations on food safety. The General Food Law, which regulates food safety in the European Union, also applies to lentils. As a supplier you must make sure that lentil exports are traceable and that safety systems (such as HACCP) are in place.

As food safety is a top priority, expect most buyers to request extra guarantees from you in the form of certifications and compliance with food management systems, such as GlobalG.A.P. for the agricultural production and ISO 22000, BRC or IFS for the processing and handling of kidney beans.

Maximum Residue Limits

The maximum residue limits (MRLs) for pesticides that might be used on lentils can be found in the EU Pesticide Database. Use of “lentils” and the type of pesticide as search terms will yield the corresponding MRLs. There are two product codes for lentils in this database: 0260050 for fresh lentils and 0300020 for dried lentils.

While MRL requirements in Europe are generally very strict, the MRL for the commonly used herbicide glyphosate was reviewed in 2012. This led to relaxation of the MRL for glyphosate when applied to dried lentils, from 0.1 to 10 mg/kg. However, many health organisations are sceptic about the use of glyphosate, which may be completely banned in the future.

Be aware that the MRL requirements for organic lentils (and for lentils used in baby food) are much more stringent.

What additional requirements do buyers often have?

Organic certification

With a growing market for organic lentils, European buyers will more often require organic certification, especially when supplying the health food market. If you want to supply organic lentils to the European Union, you must use organic production methods as laid down in European Union legislation.

Social compliance and sustainability

European buyers are paying increasing attention to their corporate responsibilities concerning the social and environmental impact of their business. As an exporter you are part of the supply chain and share this responsibility.

Quality requirements

If you are planning to export lentils to Europe, you will have to meet the right quality standards. Normally these standards are set by the European Commission (EC) or the United Nations Economic Commission for Europe (UNECE). There are no European standards for dried lentils specifically. It is best to follow the quality standards in the Codex Alimentarius: International standard for certain pulses, including lentils.

Lentils can be sold whole, split, with or without seed coat. Uniformity and appearance are important.

For European buyers dried lentils must meet the following requirements:

• Colour: green/brown, red or yellow, depending on the variety
• Lentils must be safe and fit for human consumption
• Free from abnormal flavour, odour and living insects
• Free from dirt in amounts that may be a hazard to human health
• Maximum moisture level 15%
• Moisture levels must be lower in certain climates or when transported or stored for longer periods
• Moisture content must be 2% lower for lentils without the seed coat
• Extraneous matter less than 1% (of which mineral matter <0.25% and dead insects <0.1%)
• Quality in accordance with EU regulation on contaminants, maximum residue limits (MRLs) and microbiological properties

Most buyers require you to meet the general quality standards above. However, on an individual basis buyers can set different standards. Therefore it is important always to check these with your specific client. New buyers will often require samples, which should be representative of the product delivered.

Labelling requirements

If you want to export to Europe, you must label your product. These labels must comply with European regulation.

You can read more about food labelling on the EU Trade Helpdesk. For information about consumers labels see European Union Regulation 1169/2011. Providing nutritional information will also be compulsory starting from December 2016.

The following items should be on the label of pre-packed lentils:

• Official product name
• Physical condition or treatment
• List of ingredients and allergens
• Class, size (code), number of batches, net weight in metric units
• Statement that the product is destined for human consumption
• Best-before date or use-by date
• Instructions or special conditions for storage or use
• Place of origin or provenance
• Name and address of the importer established in the European Union
• Name and address of exporter
• Lot marking on pre-packaged foodstuffs (to ensure traceability of individual batches)

In addition, the label should include any certification logo (if applicable) and/or retailer logo (in the case of products marketed under a private label).

You should use English on you labels, unless your buyer indicates otherwise.

Multilingual labels are commonly used on consumer packaging, but the language of the destination country must be included in any case.

Packaging and handling requirements

Polypropylene or multilayer paper bags with a capacity of 25 kg are commonly used as packaging for lentils, but 1000 kg bags are also sometimes employed.

Different buyers may have different preferences. If you want to use other forms of packaging, you should take European Union legislation for food contact materials into account.

Some other requirements:

• Dried lentils should be kept dry, dark, cool and well-ventilated during storage, loading and shipment.
• Lentils from different harvest periods should not be mixed, as the older seeds will downgrade the entire lot. Containers should be clean and the cargo must be protected from moisture, pests and cross-contamination (especially with organic produce).

What are the requirements for niche markets?

Fair trade and environmental certification

Fair trade and sustainable certification is still a niche requirement for lentils. It can help your product to stand out from the mass of competitors and attract consumers who are more aware of these issues. As a smaller supplier you can anticipate on the future growth of fair trade by preparing your company on the certification requirements.

5. What competition do you face on the European dried lentil market?

What are the opportunities and barriers?

Quality and food safety are important issues to differentiate your company from other suppliers. European buyers are very aware of the potential quality risks when purchasing lentils. They will ask for samples and will get these analysed in laboratories to ensure they receive the right quality. In trusted relationships quality control could take place more often in origin and samples are not needed.

As a supplier you have to know the quality of your product, but the quality test in your home country is not necessarily conclusive for your buyer. The tests done in laboratories in a European country may differ considerably from tests by laboratories in your country, for example in terms of parameters tested and the residue levels that are considered permissible. However, market entry barriers have been reduced since the Maximum Residue Level (MRL) for Glyphosate was raised to 10 mg/kg through a lobby of Canadian suppliers.

Spain and France meet part of Europe’s demand for lentils. However, the European market is not protected by import tariffs. The general import tariff for lentils in Europe is 0%.

What are substitute products?

Substitute products for dried lentils are:

• Other varieties of dry beans and peas
• Canned or pre-cooked lentils

Lentils are consumed in meals, salads, soups and curries. They may be replaced by beans or peas in some recipes. Dried lentils have the advantage over other dried pulses that they do not need to be soaked before cooking. They are also ideal for mixing with grains.

Retailers offer canned lentils as well as dried lentils – though lentil enthusiasts may feel that the canned variety are no real competition for dried lentils.

As an exporter of dry lentils you can use the potential substitute products to your benefit. You can, for example, combine your offer with other grains and pulses or add value by processing lentils into a convenience product.

Who are your rivals?

Global production volumes increased from just below five million tonnes in 2013 to just over seven million tonnes in 2017. Canada (3,7 million tonnes) and India (1.2 million tonnes) together produced almost 70% of the global lentil production. Canada dominates the worldwide lentil market in trade, production and production growth. India principally produces for its internal market.

The lentils most commonly grown in Canada are the large green (or Laird) and the red lentil. Together with the brown lentil and French du Puy variety these types of lentils are among the most commonly supplied lentils to Europe.

The strongest competition of lentils to the European market is from large scale suppliers from Canada, the USA and Turkey. Suppliers from these countries have lots of experience in the European market.

New suppliers will thus face very fierce competition. To compete with the regular suppliers you have to focus on either large, price competitive volumes or distinguish your lentils in quality or for niche markets such as organic certified lentils.

Kazakhstan has also started to become a regional power in the production of lentils, supplying key end markets such as Turkey and Iran, but also countries in Eastern Europe.

Developing countries that managed to increase their lentil supply to Europe include:

• India (2.3 thousand tonnes — 416% growth from 2013 to 2017);
• Argentina (1.5 thousand tonnes — irregular supplier, mainly to Spain);
• Kazakhstan (1.1 thousand tonnes — new supplier);
• Ukraine (one thousand tonnes — 487%).

How much negotiation power do you have as a supplier?

Large food retailers have a strong position in Europe and correspondingly large buying power. Unless you are supplying a niche type of lentil or can offer superior quality-price ratio, you will have limited room for negotiation.

Some of the smaller lentil varieties such as the beluga lentil have found their entrance in Europe. Other niche varieties can also be interesting for the European market, but will need lots of marketing effort to be introduced.

6. What do the trade channels and market segments of interest for dried lentils in Europe look like?

Well-developed trade channels

The trade channels for dried lentils are well developed, which means that businesses are mature and experienced.

Lentils arrive in Europe through importers that are specialised in sourcing, trading and/or managing local brands. These are the companies you should aim for as a foreign supplier.

Some of the large sourcing companies have built their own processing facilities in the production country, making it harder for you as an exporter to join the international trade. As an exporter it is important to have a cleaning and packing facility, or at least have access to one.

Supermarkets are the main segments for lentils

Most of the lentils are sold through supermarkets. Catering establishments (such as restaurants), ethnic stores and street markets also offer lentils, but are smaller segments.

Online sales through web shops is increasing, especially in northern Europe. If you offer organic lentils, you can also target specialised organic shops.

7. What are the end-market prices for dried lentils?

Retail prices for dried lentils in Europe are between 1.5 and 3 euros per kg, and 3 to 5 euros for organic lentils.

Pricing depends on variety, package size, brand and country. As an exporter you can expect to receive a better trade price if you focus on a premium quality or organic lentils.

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