Midsouth And Texas Rice Sales Stall
Occasional showers and cooler temperatures continue to slow the harvest in the Delta/Arkansas region this week. We believe that harvesting is 67-70% done. Most growers are pleased with average or better yields and good quality.
Barge trade remains sporadic, mainly because growers are asking $6.90-$7.25 per bu ($15.30-$16.10 per cwt) and buyers are attempting to bid at $0.70 under the Nov futures for nearby rice, and up to $1.70 under the Jan or Mar for deferred positions.
The gap between the numbers starting with a 13 and those beginning with a 16 is too wide to bridge at the moment. In all of the long grain area, we believe that between 30% and 65% of the new harvest has already been contracted, which radically diminishes the incentive to move cash rice today — from both sides.
Sales of rough rice in Texas nearly stopped, as the single buyer dropped their bid to $9.50 (conventional) and $9.00 over loan (hybrids). There was one sale this week, with zero confirmations. We continue to believe that it will take $10.00 over loan to begin the next cycle of sales.
South Louisiana continues to see quiet bidding at $25.00 per bbl FOB farm, although the mills are out to Jan/Feb for shipment. Second crop harvest should begin within two weeks in Louisiana and three weeks in Texas, and weather permitting be largely finished by the middle of November.
The cotton market experienced a very fun and exciting week as trading focused on strong fundamentals factors, both of the bullish and bearish variety. Many have been left perplexed with