| Our thoughts and prayers go out to the victims of Hurricane Milton and the relentless devastation on so many communities. Rice country escaped this weather system, but there are many family members and friends that have been impacted. In light of these wild weather events, global unrest, and election cycles, rice harvest is still clipping along or wrapping up. Arkansas is finishing up its final 5%, where Louisiana, Texas, and Mississippi are all but done. Missouri is reporting at 82% this week, and California at 45%. Initial field yields on the west coast were very low but have since recovered some, where it is now expected that overall the state will be off by about 5%. There has still been virtually no new crop priced as of this writing because of the oversized old crop, but we expect to hear initial pricing soon. On the ground, Texas is reporting prices of $15.25-$15.75. Louisiana is $15.50/cwt, while Mississippi, Arkansas, and Missouri are $14.75/$15.25. Last week our special on India (thank you for the insight V. Subra!) took the spotlight over the port strike. Fortunately for us all, it was resolved before catastrophe, but anyone involved in logistics knows that our U.S. ports are already antiquated, and a continued ban on mechanization will only extend the pain for years to come. This issue is not over, but has been staved off for the moment. The supply chain is now in the process of unsnarling the log-jam that took place from the few days of stoppage. In South America, particularly the Mercosur countries, fields have finally dried up enough for farmers to make spring planting gains. Up until this week, rains in Brazil and Uruguay had prevented activity. Planting intentions are for a large crop (15% increase) as prices, water reservoir levels, financing and the domestic/international market outlook are considered positive. November 15 is the apparent cutoff date; afterwards field yields will drop we are told. With current low stocks, prices remain firm. The most recent FAO Rice Price Update shows the FAO all rice price index dropped .7% from last month, and is down 6.1% from last year at this time. The average most recently is 133.1. The primary drop was the aromatic varieties, and a direct result to India announcing the removal of its export ban and the arrival of its bumper crop. This of course is the primary driver on the supply side of the equation, while demand is now restructuring with all of the Indian rice now available. Because this Indian rice is available, the markets in the East are experiencing more volatility than the prices in the West. For example, U.S. prices haven’t fluctuated more than 5% from the $800 pmt price in the last three months, while Thai prices have dropped 14% from three months ago, now at $500 pmt, and Viet prices have dropped closer to 8%, now at $550 pmt. This, of course, is because Indian prices are now at $490 pmt. It has been the strong purchases from Indonesia that have helped support Thai prices as of late, but there is still much to be settled as Indian exports work their way back into the market. The weekly USDA Export Sales report shows net sales of 61,000 MT this week, up 70% from the previous week and 4% from the prior 4-week average. Exports of 73,200 MT were up noticeably from the previous week and up 24% from the prior 4-week average. The destinations were primarily to Mexico (30,500 MT), Haiti (15,100 MT), Saudi Arabia (9,400 MT), Honduras (5,900 MT), and Guatemala (4,600 MT). |
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