| With the crop planted and emergence on track, all eyes are now on the crop condition and weather. As of this week, 13% of the crop is in Excellent condition, which is 3% lower than last year. 54% of the crop is in Good condition, also 3% behind last year. 30% of the crop is in Fair condition, 4% more than last year, and only 3% of the crop is in Poor condition, 2% more than last year. All in all, good news so far, but weather systems in Arkansas look to threaten the outlook; right now 57% of rice in Arkansas is reported as Good/Excellent, and we may see that number drift closer to 50% if cold and wet conditions materialize and persist. The recent USDA Grain report shows global rice production to be flat this year, as the larger Indian crop, on account of the increased second rabi crop, will be offset by reductions in Thailand and Cambodia. Consumption is expected to grow slightly, and global stocks have bumped as well on carryover from India’s record crop last year. The price graph below paints a clear picture of the global rice trade, where U.S. Long Grain FOB prices are in a class of their own—and that’s not technically a good thing. This is the reason that exports have been dismal all year, and the coming normal crop size this year is expected to change that. We expect price convergence on all parts for the major exporters in the Western Hemisphere; that is to say, U.S. long grain prices will fall, and South American prices will rise. Production hiccups due to drought in some of the major exporting regions in South America have constricted exportable supply, so firming prices are in the future for this region. Brazil is down 7% year over year and Argentina is down 20% year over year, for an expected total supply reduction of approximately 5%. None of this will come to pass until close to harvest, while right now we wait on a stagnant paddy market and a quiet export market with tight supplies to blame. An upcoming tender in Panama for 68,000 tons paddy basis (August delivery) along with climate issues affecting the domestic crops and creating shortages in Ecuador and Peru are expected to influence the market. |
 |
| Source: USDA June 2023 Grain: World Markets and Trade In Asia, prices for Viet and Thai rice have coalesced around the $500 pmt number. Both countries have the potential to see a slight firming in the coming weeks as demand remains strong from countries like the Philippines, Malaysia, and Indonesia to name a few. Indian prices have inched slightly upwards as well, resting comfortably at $455 pmt, or about 4% higher than three months ago. The weekly USDA Export Sales report is another ugly one, showing net sales of 9,000 MT, which is down 21% from the previous week, but up 34% from the prior 4-week average. Exports of 41,200 MT were down 42% from the previous week and 9% from the prior 4-week average. |
 |
25722 Kingsland Blvd., Ste. 203, Katy, Texas 77494
Phone: 713-974-7423
USRPA does not discriminate in its programs on the basis of race, color, national origin, gender identity, sexual orientation, religion, age, disability, political beliefs, or marital/family status. Persons with disabilities who require alternative means for communication of information (such as Braille, large print, American sign language, language translation, etc.) should contact USRPA at 713-974-7423. EEO.
