The USDA released their April WASDE report which only included minimal revisions to both the long grain and medium grain balance sheets. In fact, the only change to the long grain balance sheet was a reduction in imports which ultimately lowered ending stocks by 500,000 cwts.
Coincidentally, the USDA raised their season average farm price projection by $0.20 per cwt. The USDA left medium grain untouched outside of a slight adjustment to pricing despite the recent surge in demand.
For now, the USDA projects long grain ending stocks to be down 58% year over year at 13.7 million cwts.
The current projected stocks-to-use ratio of 12.7% would be the lowest since 2007/08 and is a likely reason for long grain prices returning a $1.50 per cwt more than last year. Overall, all rice season-average farm prices firmed this month as the USDA bumped it’s US rice price forecast by $0.20 per cwt to $13.20 per over loan.
In the cash market, tight supplies in Louisiana continued to drive up cash prices, where quotes were reported up $2 per cwt against last week. With Texas old crop depleted, buyers are beginning to look to new crop and are already offering $12 per cwt.
The story remains similar in Mississippi and Arkansas where scarce supplies make it difficult to pin down spot pricing. The latest report pegs the Arkansas cash price at $14.40 delivered mill. While Arkansas looks poised to make strong headway in planting in the coming days, Mississippi continues to be hamstrung by weather.
Conditions in Missouri are beginning to improve, and it appears that groundwork should commence soon, assuming weather allows.
Nearby contracts for most grains finished up today as the Fed sought to push through a new lending plan that would provide $2.3 trillion to prop the US economy.
The July rough rice contract ticked up $0.205 per cwt and settled at $14.295 while the September contract gained $0.10 per cwt and settled at $12.045 per cwt. A $2.25 spread between these two contracts is unusual at this time and should converge some in the weeks ahead.