Rice Market Update: Delta Farmers Battle Weather for Planting

    Drill seeding rice. Photo: Bruce Schultz, LSU AgCenter

    Rice growers throughout the delta attempted to make strong progress in planting this past week, but efforts were curtailed in some regions due to adverse weather conditions.

    According to the USDA’s crop progress report, Arkansas is still a little behind schedule, but growers are ready to go as soon the weather conditions improve.

    In Texas and Louisiana, planting is on its final approach with both states respectively reported to be 91% and 81% completed.

    After a relatively slow start, growers in Mississippi and Missouri were quite productive and saw the amount of ground planted double from the prior week.

    In the Gulf, ongoing strain in the cash market is forcing some mills to rail in rice for the purpose of finishing outstanding sales. Most likely, mills still needing inventory or looking to originate new sales will be required to source their supplies from farther up the River, and even then, it will be a struggle to do so.

    The world rice market certainly looks much different than last year, which based on the increase in US rice acres doesn’t surprise anyone. However, for some perspective, Thai 100% B export prices which have become a global benchmark for rice in recent years, are up 37% from 12-months ago.

    Although rough rice cash prices in Arkansas are only up 12-13% since last April, the world market price for paddy, according to the USDA is up nearly 36% year over year.

    As for Asian exporting countries, things appear to be loosening up a little with Vietnam now expected to resume back to full export speed in May (still awaiting official announcement). However, some liquidity issues may linger as Myanmar limits its rice exports and quotes remain difficult to retrieve from Pakistani exporters.

    Looking at U.S. rice exports this past week, net sales dropped to a marketing year low of 28,700 MT as new sales become increasingly difficult amid tight supplies. Similarly, exports were also off significantly, slumping 75% from the previous week.

    The futures market reflected the value in old crop as the nearby contract jumped $2.175 per cwt against last week. While open interest was relatively flat, volume was down 17% from last week.

    Full report.

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