On behalf of the US Rice Producers Association, Neal Stoesser, rice producer from Raywood, Texas, and USRPA Chairman, issued the following statement on the release of the Further Continuing Appropriations and Disaster Relief Supplemental Appropriations Act.

“USRPA applauds the inclusion of disaster and economic assistance for agricultural producers included. Thanks to the tireless efforts of House Agriculture Committee Chairman Glenn "GT" Thompson, Senate Agriculture Committee Chairman John Boozman, and each of their respective staffs, producers will receive the assistance they need to compete in this ever-charging environment. They have also ensured that the farm bill programs that farmers across agriculture rely on were reauthorized for another year.

“Rice farmers are grateful and encouraged as we look forward to working with these servant leaders to enact a 2025 farm bill that lifts up the farm safety net and the farmers who depend on it to feed their families, our country, and the world.”

In light of the following facts and the ongoing deterioration of economic conditions threatening the financial survival of America’s farmers, the US Rice Producers Association calls on the Congress not to leave for a holiday without providing sufficient farm economic assistance to ensure that our farmers can survive to plant a crop next year.

• $131 per acre: The amount rice farmers on average are losing on their crop this year.

• $30 billion: Losses across U.S. agriculture in 2024.

• 441 days: How long it has been since the 2018 farm bill expired, during which time Congress has not acted to update the law to reflect today’s inflated production costs and lagging prices.

Rice Producers call on Congress not to leave for the holidays without first providing sufficient economic assistance to ensure that our farmers can hold on to plant a crop next year.

Chart Source: Terrain Agricultural Economics

This will be about the last week we report on crop plantings as the majority will be at 100% next week, except for California and maybe Texas. It’s been a relatively painless planting season, save a few isolated weather events. Rice emerged is progressing nicely as well, still 10% ahead of the 5-year average with Louisiana at 94%, Mississippi at 89%, Texas at 88%, Missouri and Arkansas both at 85%, and California down at 15%.

We do have enough information with these reports though, to lay out a decent idea of acreage we have in each state by long grain and medium grain. In Arkansas, surveys have brought us to approximately 1.3 million acres of long grain and 165,000 acres of medium grain. Louisiana is reporting 390,000 acres of long grain and 60,000 acres of medium grain. Mississippi is just over 100,000 acres of long grain, with no medium grain expectation. Missouri is 195,000 acres of long grain, and 5,000 acres of medium grain reserved for seed. Texas is looking at 130,000 acres long grain, and 3,000 acres of medium grain, also reserved for seed. California is now projected at 470,000 acres of medium grain. This gives us a long grain total of 2.115 million acres, a medium grain total of 703,000 acres, and a grand total projected U.S. rice production of approximately 2.818 million acres of rice. This is welcome news to a market that has been battered by decreased production two years in a row. Input suppliers and allied industries domestically are thankful for the return to normal, and the battle will now be regaining the market share that has been lost due to high prices and short supply.

A look at USDA acreage numbers since 2018, particularly long grain rice reinforces what all farmers know: until the rice is cut, dried and stored we don’t know what we have in hand.

The market will be going through an adjustment where, much like the stock market, bad news will be good news. As we know, tight supplies have led to high prices and constricted exports. All industry members keep saying that a larger crop will bring U.S. long grain back to a competitive nature. However, that means prices will have to drop significantly to compete with Paraguay, Brazil, Uruguay, Argentina, and heaven forbid—Viet/Thai/Paki rice. With the expiration of CAFTA-DR and most tariffs being suspended to reduce food inflation, prices will need to come down at least $140 pmt — and this makes us competitive with just Brazil. While a decrease of that magnitude is “bad news,” that’s the only way to claw back our export customers and see our export numbers climb once again. This is a farm bill year, and its passage and implementation will be more important then ever going into a climate with so many factors at play.

In Asia, prices continue to hover around the $500 pmt for both Vietnam and Thailand. India is holding firm in the $440 pmt range, and recently announced a special relaxation of their export restrictions on broken rice to help provide 200,000 mt of broken rice to Indonesia, 500,000 mt of broken rice to Senegal, and 50,000 mt of broken rice to Gambia.

The most recent FAO Rice Price Index reports that against the backdrop of rising inflation, input costs, Russia’s war on Ukraine, drought in major rice producing regions (namely Brazil, China, and the U.S.), global rice exports are expected to contract for the first time in four years for calendar year 2023. The report expects a global export contraction of 4.4%, down to 53.6 million metric tons.

CASABLANCA, MOROCCO - This week, USRPA Staff and membership traveled to Morocco for a regional summit with the USDA Foreign Agricultural Service to bolster trade in the region. This summit comes at an excellent time given that USRPA trade missions in recent months have gained valuable ground and relationships in the territory.

The USDA and Foreign Ag Service have directed focus towards Africa and the Middle East as the population growth and improving logistics make market expansion opportunities abound for U.S. agricultural products. It was noted by FAS staff in the North Africa region that there is strong market demand for U.S. rice, and importers are eager for fresh supplies after the short crop over the past two years. Government representatives from West Africa reminisced of the days when U.S. rice was a normal sight on the shelves, and are eager to work collaboratively to see that happen again.

The Administration also communicated its key focus point on climate change. Political Appointee, Jeremy Adamson, offered several reasons how climate change is impacting policy, trade, supply lines, and the environment. Adamson also introduced new tools that help farmers measure carbon capture and climate smart practices, and these tools will be rolled out the general public in the coming weeks.

This summit showed that there is not only significant opportunity in the Middle East and Africa, but also strong enthusiasm for U.S. products. Meeting in person created the opportunity to build valuable relationships with FAS Staff, USDA staff from Washington DC, and industry partners to position USRPA and its farmer members for success in this turbid and changing market environment.

Supreme Court Rules on WOTUS Case

On Thursday, the Supreme Court released its decision on Sackett v. Environmental Protection Agency (EPA) regarding the scope of the Clean Water Act. The case involved a property owned by the Sackett family where they intended to build a house. In 2007, the Army Corps of Engineers and EPA halted construction saying the property likely contains a protected wetland, leading the Sacketts to sue. The Supreme Court unanimously agreed to overturn the lower court’s decision and decided the land in question should not be regulated under the Clean Water Act; however, there was disagreement on the implications. The Court ruled on a 5-4 vote that the Clean Water Act only applies to wetlands with a continuous surface water connection to larger bodies of water. This ruling could impact the EPA’s Waters of the United States (WOTUS) Rule which went into effect in March 2023. To read the entire decision click here.

House Appropriations Committee Delays Markups

On Tuesday, House Appropriations Committee Chairwoman Kay Granger (R-TX) announced the Committee was postponing markups scheduled for this week to provide more flexibility as discussions continue regarding raising the debt limit. The Committee was scheduled to mark up the agriculture appropriations bill for fiscal year 2024 on Wednesday. The bill was previously marked up by the Agriculture Appropriations Subcommittee on May 18.

Congratulations to Renato Gastaud, President of SAMAN (Sociedad Anonima Molinos Arroceros Nacionales), one of the most prestigious rice companies in the world and located in Montevideo, Uruguay, on his recent announcement to retire. Since 2007, SAMAN has been part of Camil Alimentos group, establishing itself as the continent’s leading rice company and one of the top five in the world. Long a symbol of consistent quality, SAMAN’s presence is known throughout the world marketplace. The USRPA always enjoyed and appreciated Renato’s participation in the Rice Market & Technology Convention and wishes him the very best in the years ahead. Felicidades Renato!

The rice complex is rounding the corner to finish planting the crop. The only state not 90% or more planted at this point is California, which is perfectly acceptable and normal. While California is a bit behind schedule at 40% planted, the next two weeks will be for the record books as round-the-clock effort and high horsepower will push to complete plantings by June 1. Emergence is solid as well, with all states besides California at 70% and higher. On the whole, we are 83% planted compared to 76% on the 5-year average, and 65% emerged compared to 54% for the 5-year average. Prices on the ground are relatively unchanged and light paddy supplies with all attention focused on planting. It will be interesting to see price discovery in action as we enter the summer months and get a handle on the true size and potential of the crop.

The long grain market continues to plug along with steady domestic business, and very sporadic export business that hasn’t amounted to much this year aside from Iraq and Haiti finally being a viable buyer once again. As we’ve mentioned, this has been the expected market response to consecutive years of short production, and with increased acreage coming down the pipe, we hope to see exports increase once again. Retaining and recapturing our historic core markets will prove to be an uphill battle, as trade agreements are expiring and rice from cheaper origins is flooding the market, namely Brazil. Today’s meeting in São Paulo of CONMASUR (Confederation of Rice Mills of Mercosur), which includes the major rice growers and milling companies of Argentina, Brazil, Chile, Paraguay, and Uruguay, will give insight into recent harvest numbers and the outlook for expected market competitiveness. The USRPA will publish these numbers in next week’s RA.

In Asia, price is still firm in Thailand, now flirting with the $500pmt price point. It has been approaching this number for the past several weeks, and continued strong demand could push it even higher. But with Vietnamese rice trailing by approximately $10 at $490pmt, it’s possible to see more demand flex that way. As discussed in last week’s report, rice from Thailand is on a vessel headed to Mexico; current pricing would disqualify this as a possibility in today’s market. However, Thai rice was significantly cheaper when the business was initially booked, putting further strain on competition for rice trade in the Western Hemisphere.

The USDA Grain Report most recently published calls for global rice production to be up 12 million tons from last year to a new record of 521 million tons. Pakistan had the largest bump in the numbers as it is recovering from a significant drought, and China is a close second where they expect to see an increase as well from a recovery of dry conditions. Global stocks are forecast down by 2.5 million tons to 167 million, where China and India hold a staggering 81% of all global stocks. Regarding the United States, it is expected that imports will remain flat at 1.25 MMT on a larger crop and sustained fragrant rice procurements. The report shows that exports from the U.S. are forecast to rise with a larger crop both for medium and short grain, thus creating lower prices. It is expected that exports will increase from 2.05 MMT to 2.35 MMT.

This week’s USDA Export Sales Report shows an export reduction to 31,700 MT this week — a marketing-year low — which is down noticeably from the previous week and from the prior 4-week average. Net sales of 73,200 MT for 2023/2024 were reported for Iraq (40,000 MT), Japan (27,200 MT), and Guatemala (6,000 MT).