Although rice harvest has begun in the lower delta, the data has yet to make it to the weekly crop progress USDA reports. This week’s rain in south Louisiana and the weather event expected to move thru Texas’s rice growing region won’t help that either. Harvest is just barely underway in these states, and so far the field yields look good, and what’s been milled also looks positive. Price discovery is in its early stages and will improve as more harvest data becomes available. For now, prices remain mixed, with Texas prices down slightly while Arkansas and Missouri prices slightly up from last week. Unless the aforementioned weather systems result in heavier than expected rainfall and wind, the crop should come thru it unscathed. However, if the storms are worse than predicted, and yields are dampened as a result, buyers may be tempted to pick up a few more lots which may result in some price action.
The crop progress report painted a favorable picture for several states, as rice headed was generally above their 5-year averages for this time of year. Unfortunately, the largest rice growing state in the country, Arkansas, was recorded at only 10%, down 20% from the historical average.
At the beginning of July, total export demand for US long grain rice was down 6.75% year to date, and now the latest export sales report cites total demand to be down 9.45% YTD. This slowing of export business falls in line with industry expectations as sellable supplies all but dried up later in the season. Continuing the trend, net sales for the week were down again this week (30%).
Overall, it was a relatively quiet week for rice worldwide. Planting continues to progress throughout Asia, and it appears that India is working on a record sized crop which is benefiting from favorable monsoon conditions. While demand hasn’t been overly attractive recently, most of the trade expects to see a surge from Bangladesh, China, and other destinations. Export prices in Asia were a bit mixed this week, as was the case last week. Thai 100% B prices bumped $5 per ton to $470 FOB. Meanwhile, Vietnam and Myanmar pricing were unchanged, quoted at $465 and $440, respectively.
Futures weren’t too exciting this week with the nearby contract only improving 6 ½ cents from last week. Volume fell by 26% but open interest was basically flat. Surprising to some, further out futures contracts appreciated more than the nearby which were up between 13 ½ to 14 cents per cwt.