| Prices are still firm as the U.S. is the only supplier of viable long grain quantities in the Western Hemisphere at the moment. A strong domestic market, which proved to be the savior last year when export sales were painfully low, continues to be a help in the current market environment. The buyer that is noticeably absent at the moment — but not a cause for concern — is Iraq. Iraq has already procured much of what was expected from the U.S. They are busy making acquisitions in the East, so an entry from Iraq back into the U.S. market would only firm prices further. As it stands, mills are already busy with fulfilling Iraq deliveries, so all is good on that front. What is not so great for the mills, however, is the overall milling quality of the crop. There have been a lot of reports of below-normal quality this year, ranging from the low 40s up to the mid 50s. Some regions are much better than others, but surveys would suggest that on the whole at this stage in the game, 51-52 is normal. Anything as high as 55 is a blessing to help make up for the sub-50s that are all too common this year. Prices on the ground remain firm, with adequate volumes transacting in recent weeks. The low levels of the Mississippi River are certainly a drag on logistics but do not seem to be slowing the purchase or acquisition of paddy prices. Prices have not moved significantly off of last week’s levels, with Texas showing $18/cwt, Louisiana at $17.30-$18/cwt, and Mississippi, Arkansas, and Missouri in the $16.75-$17.25/cwt range. As if the Russia/Ukraine conflict and the Hamas terrorism aren’t enough, Venezuela has thrown its name into the hat of potential conflicts in the Western Hemisphere. This is significant to rice because 37,000 MT of rice was just registered on the Export Sales report this week. Venezuela recently voted in strong favor of reclaiming a portion of Guyana, essentially redrawing a map that is over a century old. The United States has put its weight behind Guyana in the territorial dispute but creates another delicate situation for the U.S. to face on the international stage. There is an additional layer of complexity here because U.S. crude oil imports have begun since January of this year, up to 153,000 b/d as of July, after a halting of imports in 2019 due to political reasons. It is a tricky situation diplomatically, but good for the rice industry to regain an important market. In Asia, prices keep marching upward, with Viet prices cresting as high as $670 pmt and Thai prices reaching $630 pmt. The big question is how long prices will remain this high, and what will the ultimate impact be of India relaxing its export ban. Very strong demand in the region keeps pressure on prices that are now within $100 pmt of U.S. long grain prices. A very strange phenomenon indeed. The weekly USDA Export Sales Report shows net sales of 128,400 MT this week, up 73% from the previous week and 29% from the prior 4-week average. Increases were primarily for South Korea (40,000 MT), Venezuela (37,000 MT), Mexico (22,400 MT), the Dominican Republic (14,200 MT), and Japan (7,300 MT). Exports of 90,100 MT were up 90% from the previous week and 60% from the prior 4-week average. The destinations were primarily to Mexico (30,200 MT), Venezuela (21,000 MT), Honduras (15,700 MT), Haiti (14,200 MT), and Jordan (4,500 MT). |
 |
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.
