March 26 ,2015
Daily Exclusive ORYZA Rice E-Newsletter www.ricepluss.com
Volume 5, Issue I Daily Exclusive
ORYZA Rice Newsletter
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Daily Exclusive ORYZA Rice E-Newsletter www.ricepluss.com
Thailand Will Continue to Release Rice Stocks Despite Price Competition, Says USDA Post Mar 25, 2015
USDA Post estimates Thailand to export around 11 million tons of rice, milled basis, in MY 2014-15 (January - December 2015), slightly above 10.97 million tons exported in 2014 as the government is keen on selling around 10 million tons of rice from its stockpiles this year. During January - March 2015, the government sold around 1.3 million tons of rice stocks, including 146,205 tons of fragrant rice. Based on local sources estimations, the Post reports that the government would sell up to 5 million tons in the public tenders in 2015. According to the Post, Thailand's rice exports declined 13% y/y in January 2015 due to price competition from Vietnamese rice. Vietnam has been giving a stiff competition to Thailand by reducing the floor prices for its low, medium and high quality rice. Thailand is expected to release rice from stocks into the world market despite price competition.USDA Post estimates MY 2014-15 rice stocks to decline by one-third as the government continues to sell off its stocks, particularly those which can be reprocessed for domestic consumption or exports. The Post reports that the Thai government has received about 500,000 tons of fragrant and glutinous paddy as on February 28, 2015 against the target of around 2 million tons under the onfarm pledging program for 2014-15 main crop fragrant and glutinous rice introduced by the military government in November 2014. The program was meant to encourage farmers to delay sales of around 2 million tons of rice to control price falls during the harvest season. MY2014/15 off-season rice production is likely to decline to 4.9 million tons, down about 14% from around 5.7 million tons last year. The Post estimates 2014-15 (January 2015 - December 2015) milled rice production to decline to around 19.404 million tons, down about 4% from around 20.46 million tons last year due to an expected decline in off-season rice planting following drought forecasts. According to the Ministry of Agriculture and Agricultural Cooperatives, as of February 20, 2015, droughtdamaged area totalled 1,203,552 rai (192,568 hectares), of which 1,145,390 rai (183,262 2
Daily Exclusive ORYZA Rice E-Newsletter www.ricepluss.com hectares) pertains to rice crop. However, the MY 2014-15 off-season rice area is approximately 40% above the government's estimate despite the official warnings on low reservoirs. The Thai Meteorological Department (TMD) expects normal precipitation in 2014 compared to below average precipitation in 2014.The Post estimates MY 2014-15 rice consumption to increase about 1% due to an expected increase in feed use of broken rice in swine rations.
EU Rice Production Will Remain Stable in Next Decade But Consumption will Increase, Says Report
Mar 25, 2015
A report titled "Prospects for EU agricultural markets and income 2014-2024�, released in December 2014, predicts that EU's rice production will remain stable over the next decade through 2024 on a slightly decreased area but the region's rice consumption will increase slightly to around 5.5 kilograms per person per year during the period.According to the report, though the EU rice market seems to be highly fragmented, Japonica and Indica rice varieties occupy a major 3
Daily Exclusive ORYZA Rice E-Newsletter www.ricepluss.com share. In terms of production, currently Japonica varieties account for approximately two-thirds of EU rice production, but the proportion is expected to decline in the next decade as production of Indica varieties has been picking up for the last few years due to high international prices. The report says, the EU has limited capacity to expand production with only few countries engaged in production, the EU has to continue its dependence on imports to meet the rising consumption demand. Italy and Spain contribute to nearly 80% of EU rice production.On the consumption side, Indica type varieties account for nearly 60% of EU rice consumption and Japonica varieties account for 40%. Since EU is not self sufficient in rice production, the EU is expected to import around 40% of the rice it consumes. Nearly 90% of its rice imports consist of Indica rice varieties. In 2009, the EU signed the Everything But Arms (EBA) Agreement with the Asian least developed countries (LDCs) such as Cambodia and Myanmar, under which the EU imports rice from the LDCs at zero-percent duty. It was basically aimed to raise incomes and living standards of farmers in the LDCs.Despite its significant rice imports, the EU is expected to remain a net exporter of Japonica rice, says the report
Global Rice Quotes March 25th, 2015
Long grain white rice - high quality Thailand 100% B grade 395-405
↔
Vietnam 5% broken
360-370
↔
India 5% broken
390-400
↔
Pakistan 5% broken
365-375
↑
Myanmar 5% broken
410-420
↔
Cambodia 5% broken
425-435
↔
U.S. 4% broken
480-490
↔
Uruguay 5% broken
580-590
↔
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Daily Exclusive ORYZA Rice E-Newsletter www.ricepluss.com Argentina 5% broken
570-580
↔
Long grain white rice - low quality Thailand 25% broken
370-380
↔
Vietnam 25% broken
340-350
↔
Pakistan 25% broken
330-340
↑
Cambodia 25% broken 410-420
↔
India 25% broken
360-370
↔
U.S. 15% broken
470-480
↔
Long grain parboiled rice Thailand parboiled 100% stxd
385-395
Pakistan parboiled 5% broken stxd
↔
India parboiled 5% broken stxd 380-390
↔
U.S. parboiled 4% broken
555-565
↔
Brazil parboiled 5% broken
570-580
↔
Uruguay parboiled 5% broken NQ
↔
385-395
↔
Long grain fragrant rice Thailand Hommali 92% Vietnam Jasmine
890-900 460-470
↔
India basmati 2% broken
NQ
↔
Pakistan basmati 2% broken
NQ
↔
Cambodia Phka Mails 795-805
↔
↔
Brokens Thailand A1 Super
320-330
↔
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Daily Exclusive ORYZA Rice E-Newsletter www.ricepluss.com Vietnam 100% broken 305-315 Pakistan 100% broken stxd Cambodia A1 Super
↔
285-295
345-355
↔
India 100% broken stxd
275-285
Egypt medium grain brokens
NQ
U.S. pet food
↔
380-390
Brazil half grain
NQ
↔
↔
↔
↔
All prices USD per ton, FOB vessel, oryza.com
Precision Agriculture Tools Gain More Popularity in U.S. Rice Industry, Says USDA Mar 25, 2015
USDA in its latest Agricultural Resource Management Survey (ARMS) of the U.S. rice industry reportedly found that the use of precision agriculture tools - used to manage fields by measuring variations in nutrient needs, soil qualities, and pest pressures - has increased significantly in 2013 compared to that in 2006.The highest increase was spotted in the use if Yield Monitor tool, which can identify variations in yields within a field and allow farmers to adjust inputs and practices accordingly. USDA found that 60% of rice farms have been using this tool in 2013 compared to 29% of farms using it in 2006.Similarly, Auto-steer or guidance systems, which reduce stress on operators and reduce errors in input application, are being used by 50% of the farms in 2013 6
Daily Exclusive ORYZA Rice E-Newsletter www.ricepluss.com compared to 24% of them in 2006.USDA says, the use of these two technologies are proved to have increased yields while reducing costs.
VFA Pessimistic About Vietnam’s Rice Export Prospects in 2015 Mar 25, 2015
The Vietnam Food Association (VFA) noted that Vietnam's rice exports in 2015 would be affected by rice oversupplies in Thailand and other rice exporting nations, according to local sources.The VFA noted that the oversupply of rice has been putting downward pressure on global rice prices as well as creating a price competition among rice exporting countries. The Export Import Department under the Ministry of Industry and Trade also revealed the same point at a seminar on rice and seafood export conditions in Can Tho city.While export prices of Viet 5% rice declined about 5% to around $365 per ton from around $383 per ton in the beginning of this year, export prices of Thai 5% rice also declined about 5% to around $490 per ton during the same period. According to data from the VFA, Vietnam businesses signed contracts for export of around 1.94 million tons as of March 19, 2015, up about 7% from last year. But 1.4 million tons are yet to be delivered.Vietnam exported around 536,571 tons of rice in January 1 - March 19, 2014, down about 56% from around 1.22 million tons of rice exported in first three months of 2014, according to VFA. Average rice export price so far in this year stands at about $440 per ton (FOB), up about 2% per ton from same time last year. Traders told local sources that the recently struck deals to supply 240,000 tons to Malaysia and 300,000 tons to the Philippines have also not been helpful to hold the export prices steady. An output of around 5 million tons from the ongoing winter-spring harvest is expected to further push down the prices, according to local sources.Vietnam has been more cautious to retain market share amid increasing global supplies. It had cut the export floor price of lower quality 25% broken rice variety to $360 per ton from about $380 per ton in January 2015. It has however retained the export floor prices of higher quality and medium quality rice such as 5%, 10% and 15% broken rice varieties at their current levels at around $385 per ton, $375 per ton and $365 7
Daily Exclusive ORYZA Rice E-Newsletter www.ricepluss.com per ton respectively.USDA estimates Vietnam to export around 6.7 million tons of rice in 2015, up about 6% from around 6.325 million tons in 2014.
Oryza Afternoon Recap - Chicago Rough Rice Futures Slide below $11.000 per cwt as Selling Pressure Picks up after Market Approaches Key Technical Resistance Mar 25, 2015
Chicago rough rice futures for May delivery settled 16.5 cents per cwt (about $4 per ton) lower at $10.960 per cwt (about $242 per ton). Rough Rice futures fell today as the recent uptrend had prices pennies away from a key technical level which was being closely watched by many traders. Many industry insiders have kept a keen eye out for a close above $11.160 per cwt (about $246 per ton), a level that marked a put in place when prices reached a near-term high in mid-February. Although the market was well within reach of this point the bears made a strong stand to protect this level and dragged prices back below $11.000 per cwt (about $243 per ton) by the ringing of the closing bell. The other grains finished mostly lower today, despite a rally in crude, with corn the only component of the complex managing to pull off another slight gain; Soybeans closed about 0.6% lower at $9.7875 per bushel; wheat finished about 0.9% lower at $5.1900 per bushel, and corn finished the day about 0.5% higher at $3.9500 per bushel. U.S. stocks traded about 1% lower on Wednesday as investors weighed the impact of the dollar on the U.S. economy and the coming earnings season. The Dow Jones industrial average extended losses to fall as much as 239 points as all the major indices declined, giving back gains from the rally after last week's Fed announcement. February's durable goods orders fell 1.4%, missing expectations of a modest pick-up. The core non-defense capital goods orders excluding aircraft also fell 1.4% last month. The report marked the sixth straight month of declines, likely weighed down by the strong dollar and weak global demand. Elsewhere, Greece risks running out of cash by April 20 unless it secures fresh aid, a source familiar with the matter told Reuters on Tuesday, leaving it little time to convince skeptical creditors it is committed to economic reform. The Dow Jones Industrial Average traded down 191 points, or 1.06%, at 17,819. The S&P 500 fell 17 points, or 0.80%, to 2,074, with information technology the greatest of eight declining sectors and energy and consumer staples 8
Daily Exclusive ORYZA Rice E-Newsletter www.ricepluss.com the only advancers. The Nasdaq fell 79 points, or 1.60%, to 4,914. Gold is trading about 0.3% higher, crude oil is seen trading about 3.8% higher, and the U.S. dollar is seen trading about 0.3% lower at about 1:00pm Chicago time.Tuesday, there were 705 contracts traded, up from 377 contracts traded on Monday. Open interest – the number of contracts outstanding – on Tuesday decreased by 54 contracts to 8,705.
Pakistan Rice Sellers Increase Some of Their Quotes Today; Other Asia Rice Quotes Unchanged Mar 25, 2015
Pakistan rice sellers increased their quotes for 5% broken rice and 25% broken rice by about $5 per ton and $15 per ton to around $365- $375 per ton and $330 - $340 per ton, respectively, today. Other Asia rice sellers kept their quotes mostly unchanged today. 5% Broken Rice Thailand 5% rice is indicated at around $385 - $395 per ton, about a $25 per ton premium on Vietnam 5% rice shown at around $360 - $370 per ton. India 5% rice is indicated at around $390 - $400 per ton, about a $25 per ton premium on Pakistan 5% rice shown at around $365 - $375 per ton, up about $5 per ton from yesterday. 25% Broken Rice Thailand 25% rice is shown at around $370 - $380 per ton, about a $30 per ton premium on Vietnam 25% rice shown at around $340- $350 per ton. India 25% rice is indicated at around $360 - $370, about a $30 per ton premium on Pakistan 25% rice shown at around $330 - $340 per ton, up about $15 per ton from yesterday. Parboiled Rice Thailand parboiled rice is indicated at around $385 - $395 per ton. India parboiled rice is indicated at around $380 - $390 per ton, about $5 per ton discount to Pakistan parboiled rice shown at around $385 - $395 per ton. 100% Broken Rice Thailand broken rice, A1 Super, is indicated at around $320 - $330 per ton, about a $15 per ton premium on Vietnam 100% broken rice shown at around $305 - $315 per ton. India's 100% broken rice is shown at around $275 - $285 per ton, about a $10 per ton discount to Pakistan broken sortexed rice shown at around $285 - $295 per ton.
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