Dossett On Rice: Bullish — That’s The Best Way To Put It

Rice harvest. ©Debra L Ferguson Stock Photography

Cash Market

  • Thailand rice prices are steady this week. It looks like we will consolidate at these levels as the Philippine business gets completed.
  • India prices are still slipping as the major exports in their region are winding up.
  • Brazil has activated two government programs that help them to export to the U.S. The U.S., in turn, will probably contest these moves in the WTO.
  • The U.S. market is very quiet because there is no rice left to source. I can’t find one customer in five states that has any quality rice left to sell. It has been a long time since we had this situation.
  • The Arkansas co-ops have rice but they do not want to lose control of quality rice. We did not have good exports in the Thursday weekly report, but that is the exception, not the rule. We have had very good exports for the last few months.
  • Iraq passed on the U.S.-only tender this week. That is not surprising as we assume that they only float these tenders because of strong political pressure. We will usually be very high-priced compared to Asia and South America.
  • Bottom line: we do not have a lot of rice to sell if there was a substantial export order.
  • Pakistan has sent a team to Iran to discuss rice exports between those countries. Pakistan will beat everybody on freight to Iran. Quality might be a problem.

Futures Market

Markham B. Dossett was a charter member of the New Orleans Commodity Exchange. He has traded rice since early 1981. He owns Talon Asset Management LLC where he hedges rice, soybeans, corn, wheat, cotton and cattle for producers in the South and Southwest.

** Futures and options trading involve significant risk of loss and may not be suitable for everyone.

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