Rice Market Update: Quiet Trade Week with Little News

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With the Veteran’s Day Holiday in the United States delaying the issuance of the federal reports, there has been very little movement in the rice market over the past week. The export sales report will be delayed until the 15th due to the holiday. While there are no projections as to the likely figures, it can be expected that the sales volume will remain stable at the least if not slightly higher. The export tonnage can also be expected to increase, particularly given the high-level previous sales existing on the books.

The Asian pricing complex has generally softened, albeit mildly, since the previous report. This softening has largely been attributable to fluctuations in currency valuations. Fundamental factors have not significantly changed and are not likely to in the near future.

USDA released its weekly world market price estimate this week with no changes over the previous projection.

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In the domestic cash market, nothing has changed of any consequence since the previous report. The second crop along the gulf coast continues to be harvested. Early estimates indicate that yields are ranging between 3,000 and 4,800 pounds per acre. Quality is reported as being good as are milling outturns. In the remainder of the production areas, the rice has been harvested and the quality is said to be ok at this point.

In the futures market, all of the open contracts on the board saw a negative week. Weekly losses ranged from 0.98% to 1.58% respectively. The nearby contracts experienced the bulk of the losses as compared to the deferred contracts. Both average daily volume and open interest were decreased against last week’s values.

Since the last report USDA released its November World Agricultural Supply and Demand Estimate (WASDE). This report saw mostly supply side revisions with minor adjustments at the end of the balance sheet. On the supply side, total production was lowered by 0.7 million hundredweights. This reduction was primarily a result of decreased long grain production, which is also a function of decreased yields.

The decrease in production directly impacted the rice ending stocks estimate by the same amount as there were no reported changes on the demand side of the equation. There was no apparent impact on the season average farm price for the month which remained unchanged.

With the market trading extremely sideways in almost all of the benchmark sectors, it is unlikely that any significant revisions to the current market scenario will occur in the coming weeks.

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