With Christmas only days away, the rice industry seems to have found a new purpose in the attempt to get as much last minute business done as possible before the new year.
Export sales continue to remain strong as overseas buyers get in as much last minute shopping as possible. The levels over the past few weeks have been much appreciated, especially given the mundane volume that has been posted over the past several months. There is a possibility that the export demand will slack off after the new year as buyers become satiated. Just as likely however is the possibility that more favorable pricing may exist which would encourage more sales. While the extra demand would be very welcome, any decrease in the cash price would not be.
Vessel loadings were somewhat decreased since the last report but even at current levels remains in a healthy state. Overseas origins have remained predominately unchanged. The minor variations since the last report are due almost exclusively to currency fluctuations. All of the international factors suggest a continued sideways market and as such the world market price estimate has again remained unchanged.
Domestically, buyers and sellers have been rather dormant particularly from a pricing standpoint. Given this situation, some trading has been occurring in an effort to secure last minute cash flows and lock in volume for the first part of 2019.
The futures market has been dominated by the bears this week with all of the open contracts on the board trading down between 3%-4%. As the holiday doldrums set in, the futures action should simmer down until the trade returns in a few weeks.
Rice News on AgFax
Other news of note was the issuance of the World Agricultural Supply and Demand Estimate (WASDE) this week which will be the last one of the calendar year. In this installment, there were a few revisions of interest.
On the supply side, total rice supplies for the year were increased by 0.5 million hundredweights to 276.2 million hundredweights on stronger medium and short grain imports. On the demand side, exports were increased by 3.0 million hundredweights of which medium and short grain was wholly responsible. Long grain estimates experienced no change on either side of the balance sheet.
The net result of the revisions was a decrease in all rice ending stocks of 2.5 million hundredweights with a season average marketing price increase of $0.10 per hundredweight at the midpoint of the range to result in $11.60-$12.60 per hundredweight total.