According to the USDA, rice planted in Arkansas was at 44% complete as of April 25th, which is about 12% behind the normal pace. The other delta states are generally behind schedule as well, but not as much.
It was noted that warmer weather is needed to jumpstart the growing process, but so far, the forecast calls mostly for cooler temperatures. The cool temperatures can obviously impact yields for multiple reasons, one being it pushes harvest into a wetter season.
In California, the crop was reported 12% planted, which is probably a bit low as growers have made speedy progress given the nearly ideal planting conditions to date.
US exports continue to lag significantly behind last year, down more than 11% year to date. Between the difference in year-over-year outstanding sales and in shipments, the drop in export demand accounts for approximately 10 million cwts, or 131,000 acres worth of production.
Despite lackluster demand for US long-grain, prices remain unaffected. The situation is similar in Asia, where even without breaking news, export prices are generally sideways to even slightly up from last week.
In a recent USDA GAIN report, China’s total use for rice was projected to be up 9 million metric tons from 2020/21 on higher feed use. In fact, Post estimates that due to a 6.7% increase in feed and residual use, corn imports are expected to jump to a record 28 million metric tons.
Rice News on AgFax
China’s corn stocks are at their lowest level in 15 years, which is sustaining high corn prices worldwide and is ultimately soliciting greater acreage in both North and South America. China’s misreporting of stocks and production has left the market unable to efficiently respond to the need, burdening grain importers around the world that were unprepared for such an extreme jump in pricing.
China is using every commodity in stock to minimize the feed supply shortage as record volumes of rice and wheat have been seen en route to feed mills. The market can expect further disruption due to this situation through the rest of 2021 and even into 2022.
Of course, extrapolating the amount of rice being utilized to offset corn demand is highly unknown, and as always, the data offered by China is believed to be unreliable. In other words, even when the corn complex is sorted out, the market disruption may reverberate into the rice and wheat markets as well.
It was another uneventful week in the futures market, at least for rice where traders were focused on rolling May contracts forward. May open interest fell below 1000 and volume was down to 38.