For both 2019/20 and 2020/21, U.S. import forecasts were raised while exports were lowered, with 2020/21 imports projected record high. The domestic and residual use forecast was raised for both years.
For 2020/21, the U.S. production forecast was increased 2 percent due to a larger area estimate reported by the U.S. Department of Agriculture National Agricultural Statistics Service (NASS).
On balance, these revisions resulted in a 2-million cwt (hundredweight) reduction in the 2019/20 ending stocks forecast and a 0.5-million cwt increase in the 2020/21 ending stocks forecast. In the global rice market, 2020/21 production forecasts were raised for Bolivia, South Korea, Sri Lanka, and the U.S.
U.S. 2020/21 Rice Production Forecast Raised 2 Percent to 220.7 Million Hundredweight
This month USDA raised its 2020/21 U.S. rice production forecast 4.5 million cwt (hundredweight) to 220.7 million cwt, up more than 19 percent from a year earlier. The upward revision is the result of a 74,000-acre increase in the planted area estimate to 2.91 million acres, up 15 percent from a year earlier.
The area estimate is based on a survey of producers conducted in early June to determine actual 2020/21 rice plantings. The projected yield of 7,689 pounds per acre is minimally changed from the previous forecast but is 3 percent larger than a year earlier.
The first survey-based yield forecast for the 2020/21 U.S. rice crop will be released on August 12 by NASS in their August Crop Production report.
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By class, the U.S. 2020/21 long-grain crop is projected at 161.8 million cwt, up 4 percent from the previous forecast and 29 percent larger than a year earlier. At 2.19 million acres, long-grain plantings are 4 percent higher than the level that growers indicated in March that they intended to plant and 23 percent larger than a year earlier.
Arkansas accounted for about two-thirds of the increase in the U.S. long-grain planted-area estimate between the March intended plantings and the June grower survey of actual plantings, with Missouri and Texas accounting for most of the remaining increase. From March to around June 10, when virtually all planting in the Delta was completed, long-grain became a more profitable planting option than both medium-grain rice and soybeans.
On an annual basis, rising long-grain prices in 2019/20 and somewhat better weather conditions compared with last year were responsible for the 412,000-acre expansion in southern long-grain plantings.
Although the Mississippi Delta received above-normal rainfall during most of the Spring that delayed plantings in Arkansas and Missouri, the excessive rain did not result in anything close to the level of prevented plantings that occurred in 2019/20. Almost all U.S. long-grain rice is grown in the South.
In contrast, the combined medium- and short-grain U.S. crop forecast was lowered 3 percent this month to 58.9 million cwt, virtually unchanged from a year earlier. The 2020/21 medium- and short-grain planting estimate was lowered 18,000 acres from the March intended planting level to 729,000 acres, a 4-percent decline from a year earlier.
All of the month-to-month area decline occurred in the South, mostly in Arkansas, which accounts for the bulk of southern medium- and short-grain rice production. Southern medium-grain prices declined throughout the 2020/21 planting season, mainly due to an absence of any significant international buyers.
At 234,000 acres, southern medium- and short-grain planted area is 23,000 acres below the March intended level and 14 percent below a year earlier, with Arkansas and Louisiana accounting for almost all of the reported decline.
In contrast, at 495,000 acres, California medium- and short-grain plantings are up 5,000 acres from the March intended level and 7,000 acres higher than a year earlier. California and southern medium- and short-grain rice typically sell in different markets due to differences in quality and consumer characteristics.
By State, Arkansas accounts for 72 percent of the 381,000-acre estimated increase in total U.S. rice plantings in 2020/21. At 1.43 million acres, Arkansas’ estimated rice plantings are up 24 percent from a year earlier, with long-grain accounting for all of the increase.
Mississippi’s 2020/21 rice acreage is estimated at 150,000 acres, up 28 percent from a year earlier and the highest since 2016/17. All of Mississippi’s 2020/21 rice crop is long-grain, typical for the State.
Missouri is expected to expand rice plantings in 2020/21 to 219,000 acres, up 17 percent from a year earlier. The bulk of the State’s rice production is long-grain.
At 184,000 acres, Texas rice plantings are also up 17 percent from a year earlier. Like Missouri, the bulk of the Texas rice production is long grain.
Rice plantings in Louisiana are estimated at 430,000 acres, up just 1 percent from a year earlier, as expansions in long-grain plantings barely offset a reduction in medium-grain plantings.
Finally, California’s 2020/21 rice plantings are estimated at 507,000 acres, up 2 percent from a year earlier. Short-grain accounts for most of the expected area increase. At 45,000 acres, California’s 2020/21 short-grain area is up 36 percent from a year earlier and the highest since 2013/14. Much of the California short-grain rice is exported to Japan. The rice is often used in sushi.
Arkansas is the only southern State that produces short-grain rice, consistently planting about 1,000 acres. Medium-grain acreage in California is estimated at 450,000 acres, down 5,000 acres from a year earlier.
Progress of the 2020/21 U.S. rice crop varies by region, with the Delta still slightly behind normal due to above-average rainfall this Spring and progress ahead of normal on both the Gulf Coast and in California, mostly due to generally favorable weather in both regions.
For the week ending July 5, 19 percent of the U.S. 2020/21 rice crop was reported headed, up from 14 percent a year earlier but unchanged from the U.S. 5-year average.
On the Gulf Coast, 59 percent of the Louisiana crop was reported headed by July 5, slightly ahead of both 55 percent last year and the Louisiana 5-year average of 57 percent. Harvest began around July 4 in a few small areas in Louisiana, with the pace expected to pick-up this week.
The Texas rice crop was reported 75 percent headed by July 5, well ahead of last year’s pace of just 43 percent and the Texas average of 53 percent. Weather has been quite favorable for rice production this year in Texas, with harvest expected to begin later this month.
In the Delta, just 1 percent of the Arkansas 2020/21 rice crop was reported headed by July 5, 1 percentage point behind last year’s rain-delayed crop and well behind the Arkansas 5-year average of 8 percent.
In nearby Missouri, 2 percent of the 2020/21 rice crop was reported headed by July 5, 2 percentage points ahead of last year’s rain-delayed crop but 6 percentage points behind Missouri’s 5-year average.
Mississippi’s 2020/21 rice crop was reported 17 percent headed by July 5, up just 1 percentage point from a year earlier but behind the Missouri 5-year average of 25 percent.
Finally, 20 percent of the California 2020/21 rice crop was reported headed by July 5, well ahead of 9 percent last year and the California 5-year average of 12 percent. Parts of California’s 2019/20 rice crop were delayed due to spring rains.
Crop conditions for 2020/21 U.S. rice are much improved from a year earlier in most States, largely due to more favorable weather in most areas, despite the persistent rainfall in parts of the Delta during much of the Spring.
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For the week ending July 5, 73 percent of the total U.S. 2020/21 rice crop was rated in good or excellent condition, compared with 66 percent a year earlier. In addition, just 4 percent of the 2020/21 rice crop was rated in poor or very poor condition, compared with 7 percent a year earlier.
In Arkansas, 63 percent of the 2020/21 crop was rated in good or excellent condition for the week ending July 5, up slightly from 61 percent a year earlier. Only 5 percent of the 2020/21 Arkansas crop was rated in poor or very poor condition for the week ending July 5, well below 9 percent last year.
In nearby Missouri, 58 percent of the 2020/21 rice crop was rated in good or excellent condition, up from just 45 percent a year earlier. However, 9 percent of the 2020/21 Missouri crop was rated in poor or very poor condition, 1 percentage point ahead of a year earlier. Among the three Delta rice-growing States, Missouri’s crop was adversely impacted the most by wind and rain this Spring.
In Mississippi, 64 percent of the 2020/21 rice crop was rated good or excellent for the week ending July 5, up from 59 percent a year earlier. However, 6 percent of the Mississippi crop was rated in poor or very poor condition, up slightly from 5 percent a year earlier.
On the Gulf Coast, 89 percent of Louisiana’s 2020/21 rice crop was rated in good or excellent condition, well above 67 percent a year earlier, with just 1 percent rated in poor or very poor condition, well below 6 percent last year.
Similarly, in Texas, 66 percent of the 2020/21 rice crop was rated in good or excellent condition for the week ending July 5, well above just 43 percent a year earlier, although 3 percent of the 2020/21 Texas rice crop was rated in poor or very poor condition compared with none a year earlier.
Finally, in California 100 percent of the 2020/21 rice was rated in good or excellent condition, unchanged from a year earlier.
Total U.S. Rice Supplies in 2020/21 Projected To Increase 8 Percent From a Year Earlier
In 2020/21, a larger crop and near-steady record-high imports are projected to more than offset a substantial decline in carryin, boosting total U.S. rice supplies 21.3 million cwt from 2019/20 to 285.3 million cwt. The total supply forecast is up 3.5 million cwt from the previous forecast. By class, long-grain total supplies are projected at 204.0 million cwt, up 5.3 million cwt from the previous forecast and almost 10 percent larger than a year earlier.
In contrast, combined medium- and short-grain supplies in 2020/21 are projected at 79.3 million cwt, down 1.8 million cwt from the previous forecast but nearly 5 percent larger than a year earlier, mostly a result of a much larger carryin.
The 2020/21 carryin forecast was lowered 2.0 million cwt—all long-grain—to 30.0 million cwt, due to an upward revision in the 2019/20 domestic use forecast that more than offset a larger import forecast and a reduced export forecast. The 2020/21 carryin is 33 percent below a year earlier.
By class, the long-grain carryin was lowered 2.0 million cwt to 14.2 million cwt, down 56 percent from a year earlier and smallest since 2004/05. The combined medium- and short-grain carryin remains forecast 13.7 million cwt, up 35 percent from a year earlier.
The 2020/21 all-rice import forecast was raised again, also by 1.0 million cwt, to a record 34.6 million cwt, just fractionally above the revised 2019/20 estimate. The upward revision—all for long-grain—was largely based on much-larger-than-expected imports in May that followed record imports in April.
Thailand accounted for virtually all of the increased imports in both months, with its premium jasmine rice—classified as long-grain—making up the bulk of these shipments. The U.S. imports of Thailand’s rice were the highest on record in May and just fractionally above the amount imported in April, the previous record high for Thailand’s imports.
Imports now account for around 25 percent of U.S. domestic rice use, the highest share on record. At 28.0 million cwt, long-grain 2020/21 imports are up 1.0 million cwt from the previous forecast and unchanged from revised 2019/20 record high. Combined medium- and short-grain imports for 2020/21 remain forecast at record 6.6 million cwt, up fractionally from a year earlier.
China is expected to again account for at least a third of these imports, with Puerto Rico buying all of this rice, a result of extremely discounted prices for sales of Government-held stocks. Thailand, India, and Italy account for nearly all of the remaining U.S. medium- and short-grain imports.
U.S. 2020/21 Export Forecast Lowered; Domestic Use Raised
Total use of U.S. rice in 2020/21 is projected at 241.5 million cwt, up 3.0 million cwt from the previous forecast and 3 percent larger than the year-earlier revised level, with both exports and domestic and residual use projected to be higher in 2020/21.
Long-grain total use is projected at 179.0 million cwt, an increase of 3.0 million cwt from the previous forecast and 4 percent larger than the year-earlier revised forecast. Medium- and short-grain total use in 2020/21 remains forecast at 62.5 million cwt, as revisions to domestic use and exports were offsetting.
Total use of medium- and short-grain rice is up less than 1 percent from a year earlier.
Total domestic and residual use in 2020/21 is projected at 143.5 million cwt, up 4.0 million cwt from the previous forecast, nearly 3 percent larger than a year earlier and just fractionally below the 2018/19 record of 143.8 million cwt.
This month’s upward revision in the total domestic and residual use forecast was primarily based on the higher import forecast and the larger production forecast (which includes a residual component that accounts for post-harvest losses). The year-to-year increase in total domestic and residual use is primarily based on increased total supplies of rice in 2020/21.
By class, long-grain domestic and residual use is projected at 109.0 million cwt, up 4.0 million cwt from the previous forecast and 4 percent larger than the year-earlier revised forecast. Combined medium- and short-grain domestic and residual use remains projected at 34.5 million cwt, unchanged from the year-earlier revised level.
Total U.S. rice exports in 2020/21 are projected at 98.0 million cwt, down 1.0 million cwt from the previous forecast but still almost 4 percent larger than the year-earlier revised estimate. Long-grain accounts for most of the expected increase in U.S. exports in 2020/21.
At 70.0 million cwt, the U.S. 2020/21 long-grain export forecast is down 1.0 million cwt from the previous forecast but still up more than 4 percent from the year-earlier revised level. This month’s reduction in the 2020/21 long-grain export forecast is based on expectations of continued strong competition from South American exporters in several key U.S. Latin American markets.
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Latin America is the largest market for U.S. long-grain rice, with the majority of these sales in rough rice. On an annual basis, the expected increase in long-grain exports is based on larger U.S. supplies and lower projected U.S. long-grain prices.
Similar to recent years, the United States is expected to ship very little rice to Sub-Saharan Africa beyond food aid shipments—which account for less than 3 percent of total U.S. rice exports—and is likely to continue to sell almost no long-grain rice to Asia. U.S. prices are too high for these two price-sensitive markets.
U.S. medium- and short-grain rice exports in 2020/21 remain projected at 28.0 million cwt, up 2 percent from the revised 2019/20 forecast. The United States is expected to again export little rice beyond its current six core markets.
First, the three major buyers in Northeast—Japan, South Korea, and Taiwan, whose purchases are all made as part of their World Trade Organization agreements—are expected to again account for around two-thirds of U.S. medium- and short-grain exports (on a rough basis).
Jordan typically imports around 3 million cwt of U.S. rice, all milled rice. Mexico typically purchases a small amount of U.S. medium-grain rough rice. Canada is also a regular buyer of relatively small quantities U.S. medium-grain rice, all milled- or brown-rice.
Turkey, once a large regular buyer of U.S. medium- and short-grain rice—mostly rough—returned as a small buyer of U.S. rice in 2019/20, purchasing less than a million cwt of California rough rice. Little growth in U.S. exports of medium- and short-grain exports to Turkey is expected in 2020/21.
By type, U.S. rough-rice exports are projected at 35.5 million cwt, down 0.5 million cwt from the previous forecast but up 1.5 million from the revised 2019/20 level. Most of the rough rice is expected to be sold to Latin American buyers, primarily Mexico, Central America, and northern South America.
The bulk of these shipments will be long-grain rice. U.S. milled-rice exports in 2020/21 are projected at 62.5 million cwt, down 0.5 million cwt from the previous forecast but up 2.0 million cwt from the 2019/20 revised level. Northeast Asia, Haiti, Canada, Iraq, and Saudi Arabia are expected to remain the largest commercial markets for U.S. milled rice.
The above supply and use projections yield a 2020/21 ending stocks forecast of 43.8 million cwt, up 0.5 million cwt from the previous forecast and 46 percent larger than the year-earlier revised level. The 2020/21 stocks-to-use ratio of 18.1 percent is well above a revised and abnormally low 12.8 percent for 2019/20.
By class, long-grain ending stocks in 2020/21 are projected at 25.0 million cwt, up 2.3 million cwt from the previous forecast and 76 percent higher than the 2019/20 revised unusually low level. The long-grain stocks-to-use ratio is forecast at 14.0 percent, well above the extremely low 8.3 percent a year earlier.
In contrast, medium- and short-grain ending stocks are projected to increase 22 percent in 2020/21 to 16.8 million cwt, which is down 10 percent from the previous forecast. The medium- and short-grain stocks-to-use ratio remains projected at 26.8 percent, up from 22.2 percent a year earlier and the highest since 2015/16.
U.S. 2019/20 Import Forecast Increased, Export Forecast Lowered, Domestic and Residual Use Forecast Raised
There were several revisions this month to the 2019/20 U.S. rice balance sheet, with revisions for all-rice and by class. On the supply side, the all-rice import forecast was raised 1.0 million cwt to 34.5 million cwt, up 19 percent from a year earlier and just fractionally below the 2020/21 revised record forecast.
The substantial upward revision—following an even larger increase last month—was based on monthly Census-reported imports through May and expectations regarding imports the remaining 2 months of the 2019/20 market year. In May, the United States imported 119,852 tons of rice (product-weight), down 12,5 percent from the April record but still the third highest on record.
Thailand supplied about 83,000 tons of rice to the United States in May, a record and just fractionally above the April near-record shipments. In recent years, Thailand typically sold 40,000 to 50,000 tons of rice a month to the United States. In December 2019, it sold an abnormally large quantity of about 60,000 tons.
The bulk of these imports from Thailand are its premium jasmine rice, for which U.S. consumers appear to have an increasing preference. Basmati rice from India and Pakistan is also increasing, but at a much slower rate, and basmati rice accounts for a much smaller amount of U.S. rice imports.
These specific Asian aromatic varieties are not currently grown in the United States, although the it does produce several of its own aromatic varieties. U.S. plant breeders are currently working to develop U.S. aromatic varieties that have the qualities of the Asian varieties that are desired by consumers.
The long-grain import forecast was raised 1.0 million cwt to a record 28.0 million cwt. In May, the United States imported a record 103,332 tons of long-grain rice, with Thailand supplying nearly 71,500 tons, also a record high and just fractionally above the almost 71,000 tons imported in April.
Almost all of Thailand’s long-grain exports to the United States are of its premium jasmine variety, an aromatic rice.
On the 2019/20 use side, the all-rice total domestic and residual use forecast was raised 4.5 million cwt to 139.5 million cwt, still 3 percent below a year earlier.
The upward revision was based on the continued increases in the import forecast and analysis of the June 1 NASS Rice Stocks that indicated stronger-than-expected domestic use in the March-May period for both classes of rice. The long-grain domestic and residual use forecast was raised 4.0 million cwt to 105.0 million cwt, still 3 percent below a year earlier.
The combined medium- and short-grain domestic and residual use forecast was raised 0.5 million cwt to 34.5 million cwt, still 2 percent below a year earlier.
The 2019/20 all-rice export forecast was lowered 1.5 million cwt to 94.5 million cwt, still 2 percent larger than a year earlier. The downward revision this month was based on Census export data through May, data from the weekly U.S. Export Sales report through July 2, and expectations regarding sales and shipments the remainder of the market year.
Since April, export sales have been very light, a factor of both tight supplies of long-grain rice near the end of the market year and increasingly uncompetitive prices compared with major South American exporters. U.S. prices have remained firm in the face of the extremely tight supplies as the market year ends and are above current prices for rice from Uruguay, Argentina, and Paraguay.
Long-grain exports were lowered 1.0 million cwt to 67.0 million cwt, and combined medium- and short-grain exports were lowered 0.5 million cwt to 27.5 million cwt. Although Japan currently has about 85,000 tons of outstanding sales with the United States, it is unlikely many of these sales will ship in the 2019/20 market year and instead will ship in the 2020/21 market year.
On balance, these supply and use revisions resulted in a 2.0 million-cwt decrease in the 2019/20 ending stocks forecast to 30.0 million cwt, 33 percent below a year earlier. All of the revision in ending stocks was for long-grain stocks, which were lowered 2.0 million cwt to 14.2 million cwt, 50 percent below a year earlier and the smallest since 2003/04.
Based on data from the June NASS Rice Stocks report, U.S. rice stocks on June 1 are estimated at 52.4 million cwt, down 26 percent from a year earlier and slightly below prior expectations. By class, long-grain rice stocks on June 1 are estimated at 29.2 million cwt, down 41.5 percent from a year earlier.
These are the lowest June 1 long-grain rice stocks since June rice stocks were first reported in 2008. Combined medium- and short-grain rice stocks on June 1 are estimated at 21.8 million cwt, up 19 percent from a year earlier.
Within this rice class, short-grain stocks are estimated at 0.9 million cwt, down 37 percent from a year earlier. Stocks of broken kernel rice are estimated at 1.4 million cwt, down 34 percent from a year earlier.
There were several revisions this month to the 2020/21 season-average farm-price forecasts (SAFP). First, the long-grain 2020/21 SAFP was lowered 20 cents to $11.60 per cwt, down 40 cents from the revised 2019/20 SAFP of $12.00. The downward revision in the long-grain SAFP for 2020/21 is based on this month’s larger U.S. supply forecast.
On an annual basis, the decline is based on larger expected U.S. supplies and expectations that will begin to lower prices soon after harvest begins across most of the South. The 2020/21 southern medium- and short-grain SAFP is projected at $11.50 per cwt, down 30 cents from the previous forecast and 20 cents below the 2019/20 SAFP.
Little, if any, increase in exports of southern medium- and short-grain rice is projected for 2020/21, continuing the quite low level of exports in 2019/20 when North Africa and the Middle East bought almost no U.S. southern rice. This is the main reason for the expected decline in the 2020/21 southern medium- and short-grain SAFP, despite smaller plantings.
The California 2020/21 medium- and short-grain SAFP is projected at $18.30 per cwt, up 30 cents from last month’s forecast but unchanged from the revised 2019/20 SAFP. Both production and export of California medium- and short-grain rice are projected to be similar to 2019/20 levels, with plantings indicated up slightly more than 1 percent.
In the global medium- and short-grain market, Australia is expected to increase exports next spring due to a projected crop recovery, likely pressuring prices lower toward the end of the 2020/21 market year.
The U.S. medium- and short-grain 2020/21 SAFP is projected at $16.10 per cwt, up 10 cents from the previous forecast but down 10 cents from the revised 2019/20 SAFP. The 2020/21 all- rice SAFP is projected at $12.70 per cwt, down 20 cents from the previous forecast and 40 cents below the revised 2019/20 all-rice SAFP.
There were small revisions this month to the 2019/20 U.S. SAFP for some classes of rice and for all-rice. The revisions were primarily based on NASS-reported cash prices through May and expectations regarding prices the remainder of the 2019/20 market year.
The long-grain 2019/20 SAFP was lowered 10 cents to $12.00 per cwt, and the California 2019/20 SAFP was raised 20 cents to $18.30 per cwt. These revisions raised the U.S. 2019/20 medium- and short-grain SAFP 10 cents to $16.20 per cwt. The all-rice 2019/20 SAFP remains forecast at $13.10 per cwt.