The activity that last week promised turned out to be short lived as the underlying market pulse seems to have returned to normal. The export sales report was half of last weeks’ values, which dashed hopes of a near term export rally. The upside is that even though some notable (relatively) volumes moved last week, the fundamental reasons for the market lethargy still remain.
These reasons primarily being a lack of significant offshore demand due to pricing and trade issues as well as uncertainty regarding the size and quality of the new crop.
Vessel loadings continue to post respectable numbers given the sales against which they have to work, and suggest that the market is still working out the kinks.
Asian pricing noted some minor price appreciation in most of the benchmark origins, although given the small magnitude and external market forces, the adjustments are negligible. No major fundamental factors appear to be influencing these origins at this time.
The world market price estimate released by USDA noted no changes in the values for either class of rice.
In the domestic cash market, harvest is fully underway in Texas and Louisiana and field yields continue to hold up to previously reported values (9,000 – 11,000 lbs per acre green) and quality reports appear to remain good.
Mississippi is on the verge of harvest with the combines expected to hit the fields in the next 10 days. Arkansas and Missouri are in a similar position, with harvest only slightly behind their southern neighbor. It can be expected that the next two weeks will significantly broaden the grasp on the size and quality of the overall crop which will provide some additional insights into how the marketing year will stack up over the next few months.
Rice News on AgFax
In the futures market, the open contracts on the board all closed out the week with net losses ranging from 1%-2%. This performance is actually proportionately better as compared to last week’s movements.
With harvest pressure beginning to have some influence on the market, it is no major surprise that the board has taken a downward turn. Additionally, the fundamental trade issues and the drastic shifts in the financial markets have taken their toll.
The falling market has undoubtedly suppressed the pricing equation but this is nothing new. Growers should focus on getting their crop out of the field and let events run their course before expecting any major marketing gains.