Market Update -  USDA Report Reduces Field Yields, Raises Stocks

November 11, 2022

In a week dominated by midterm elections, the rice market bumped along in a quiet fashion with no news significant enough to rise above the polls and election results. But there was a release of the USDA’s monthly Supply/Demand report, and as expected, provided a dim outlook for the coming term. We have been discussing here the severe drop in exports this marketing year, and that has unfortunately been exacerbated by an increase in imports as well (typically Jasmine and Basmati rice). There was a reduction in field yields to help reduce the supply, but not enough, as the USDA increased ending stocks by 2.3 million cwt, up to 23.2 million cwt. This is an increase of stocks by 11%.

On the ground, Arkansas has conditions much like last week; there are some offers out there but not in large volumes. There has been a bump in the futures market, but not in a significant fashion. Mississippi is reporting welcomed rains that will help increase barge traffic once again, which is good news for more than just the rice industry. Louisiana has reports of paddy boats headed to Mexico, with some delay in the most recent one.

In Asia, the market remains firm where it has been these past few weeks. Thailand has priced at $425 pmt, Viet at $430 pmt, and India at $380pmt. It is conveniently “business as usual” in much of the rice world, perhaps except for some traders trying to discover the finer points of the Indian tariff.

A quick update on the potential rail strike would show that the crisis has been averted once again, this time by extending the “cooling off period” through December 4. The original date was November 19th. This provides more time to come to an agreement among all Unions, and hopefully find a win-win for the entire supply chain.

The USDA Export Sales report shows net sales of 37,500 MT this week, which were primarily for Canada (17,700 MT), the United Kingdom (10,400 MT), Haiti (7,100 MT, including decreases of 100 MT), Guatemala (900 MT), and El Salvador (500 MT). Exports of 33,400 MT were primarily to Haiti (22,100 MT), Mexico (3,700 MT), Canada (2,700 MT), South Korea (2,700 MT), and Jordan (700 MT).

linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram