| The summer months haven’t brought any excitement in the milled rice market. Things continue to roll on as expected, though perhaps not as hoped. We can say with certainty that two months ago, we would have hoped that there would be a solution by now to the Iraq banking problem that has prohibited them from buying more U.S. rice. We would have hoped that by some miracle, Haiti would have come through its tragedy and emerged with a stable government and solid demand for rice. But we all know that diplomatic solutions are never quick or easy, and we therefore prevail in finding strong export markets and improving our domestic relationships. The crop condition continues to look significantly better than last year, which is excellent news. This year, 64% of the crop looks good compared to 57% at the same time last year. 17% is Excellent compared to 16% last year. And only 16% of the crop is registered as Fair this week, compared to 22% last year. This trend continues to breed hope that the milling quality will be better than last year. Regarding rice headed, the crop is at 44% this week, 17% ahead of the 5-year average and 10% ahead of last year. Arkansas makes up the bulk of that increase, where it took a large jump over the week and is reported 43% as of July 14. The harvest in both Texas and south Louisiana is gaining strength.  Harvest approaches at Watkins Farm in southwest Louisiana. Prices for U.S. rice have stayed extremely resilient since the start of the calendar year, hovering between $780-800 pmt. Reports still say the same, but with new supply finally just weeks away, we might see some softening in the Western Hemisphere. We can expect to see some cash bids open up in the coming weeks as well with this new supply hitting the market. The start of the Mercosur planting season is less than two months away with stocks appearing to be very limited, particularly in light of the historical floods that severely damaged about 20% of the Brazilian crop. The circumstances have paddy importers focused on the U.S. harvest. The FAO Rice Price for July shows the All-Rice Price Index dropping .6% down to 136.6 for May, which makes sense considering the drop in Thai prices didn’t start until June. As of this report, Indica and Aromatic prices were steady and it was the Japonica rice out of California that recorded the biggest drop, and down to the lowest levels since April of 2021. The long grain prices in Asia were firm and trending down because of the summer-autumn harvest, along with the retreat of the Filipino buyers from the market. They are waiting until more clarity emerges on the on-tariff changes. The weekly USDA export sales report shows net sales of 83,500 MT this week, up noticeably from last week and from the prior 4-week average. Exports of 67,800 MT were down 6% from the previous week, but up 14% from the prior 4-week average. |
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