The cash market across the Delta was quiet as growers were consumed with planting. According to the USDA, Texas’ planting progress is a little slow this year but is still reported at 70% complete which compares to on the ground sources that peg the group to be closer to 90% complete. With only a few small weather events in the forecast, growers should be able to make strong headway in the upcoming 2-weeks.
Louisiana is also a little off-pace but is expected to catch up this week as well. In fact, the situation is similar in the northern delta where planting progress is slightly delayed. Considering the crop will be much smaller, and it’s still early, growers aren’t yet concerned.
This week the USDA also released the Grain: World Markets and Trade report which contained numerous pertinent updates. Burma was featured in the report as the country’s exports fell to a 5-year low due to political turmoil. The political unrest which culminated in a military coup back in February has resulted in substantial trade disruptions ranging from logistics, financing, and even export licenses. As such, exports from this origin are expected to remain suppressed in the months ahead.
Larger production in Colombia should drive imports lower by 100,000 MT while a smaller crop in Indonesia is expected to boost demand by 200,000 MT. As for exporters, the smaller crop and political turmoil look to reduce Burmese exports by 200,000 MT which should open up trade opportunities for others South East Asian exporters. Due to higher demand from non-traditional buyers, Brazil’s exports are expected to improve by 100,000 MT in 2021 as well.
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Asian export prices were generally sideways this past week with Viet and Indian rice both losing $5 per ton while Thai prices gained $5 per metric ton. In South America, prices were unchanged with Uruguay at $620 and Argentina at $500 FOB.
Even with the bump in demand brought on by the USDA booking more than 75,000 MT which is to be shipped to West Africa, the total demand for US long-grain rice is basically flat against last year. That said, this large sale has yet to hit the books, which means total demand may break out past last year’s number in the weeks ahead.
As countries march toward herd immunity and becoming vaccinated, regional economies around the world are expected to ramp up which stimulates greater consumption of rice. Already this can be seen in countries where restaurants are reopening based on recent rice sales.
The USA is now 31% vaccinated, which is far higher than most developed countries. Israel, UAE, Chile, and UK are among the countries that have relatively larger populations to vaccinated ratios.