15th january,2015 daily exclusive oryza rice e newsletter by riceplus magazine

January 15, 2015 Volume 5, Issue I

Daily Exclusive ORYZA

Rice

www.ricepluss.com E-Newsletter

Chief Editor:Hamlik For Advertisement & Specs:

Mujahid Ali mujahid.riceplus@gmail.com

Cell: +92 321 36 92874

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Argentina Exports 458,940 Tons of Rice in First Ten Months of 2014; Down 14% from Previous Year Jan 14, 2015

Argentina has exported around 458,940 tons of rice in the first ten months (January – October) of 2014, down about 14% from around 467,995 tons exported during the same period in 2013, according to data from the Ministry of Agriculture in Argentina. Argentina exported around 11,607 tons of rice in October 2014, down about 25% from around 15,436 tons exported in September 2014; and down about 80% from about 56,701 tons exported in October 2013.

Argentina exported around 4,503 tons of rice to Brazil (about 39% of total October 2014 exports), around 2,158 tons of rice to Bolivia (about 19% of October exports), and around 2,282 Page 1 of 13

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www.ricepluss.com tons of rice to Chile (about 20% of October exports). It exported the remaining 23% or around 2,664 tons of rice to Costa Rica (875 tons), Italy (46 tons), New Zealand (20 tons), Canada (90 tons), Denmark (120 tons), Germany (100 tons), Netherlands (100 tons), Paraguay (105 tons), Uruguay (662 tons), U.K. (20 tons) and the U.S. (526 tons).

Argentina exported around 535,722 tons of rice in 2013, down about 16% from around 635,938 tons exported in 2012.USDA estimates Argentina's milled rice production at about one million tons in MY 2014-15 (April – March), against consumption of around 440,000 tons. It estimates Argentina to export around 600,000 tons of rice in MY 2014-15.

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EU Allows Member States to Decide over GM Crops Jan 14, 2015

The European Union has given more freedom to its member states to decide over planting, field trials and commercialization of genetically modified (GM) crops, including rice, according to the Financial Times.In a vote conducted in the European Parliament over the decision to allow or ban GM crops in the region, 480 members voted in favour of letting the individual governments decide over approving/banning GM crops, and 159 members, mostly Green lawmakers voted against the measure as they feared EU would turn to more bio-engineered crops. Based on the voting results, the EU passed a resolution to all its 28 member states giving them flexibility to approve/ban GM crops, which are highly restricted in Europe.

Member states have been divided over allowing GM crops within their borders for last few years after America and Asia have approved them citing them as a solution to fight food insecurity.

However, many surveys across the EU found that consumers were concerned of health risks and environmental hazards associated with the GM crops.

Currently, only GM Maize developed by the U.S.-based Monsanto is being planted in the EU, mostly in Spain. As many GM crops are awaiting approval by the EU member countries, experts say, the present measure is to make it easier for them to pass through EU authorizations.

However, some analysts said most of the member states that are against GM crops would ban them without scientific reasons. The vote has helped EU solve years of deadlock over growing GM crops. However, the new measure applies only to crops and does not cover GM used on animal feed.

Brazil Exports 1.24 Million Tons of Rice in 2014 Page 3 of 13

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Jan 14, 2015

Brazil has exported around 1.24 million tons of rice in 2014 (January – December), according to data released by the Rice Institute of Rio Grande do Sul (IRGA).Senegal remained the largest importer of Brazilian rice in 2014 with 165,062 tons, or about 13% of Brazil's total rice exports during the year. Cuba accounted for around 154,447 tons (about 12% of Brazil's total exports during the year); Venezuela accounted for around 141,524 tons (about 11% of Brazil's total exports during the year); Sierra Leone accounted for 124,395 tons (about 10% of Brazil's total exports during the year); and Gambia and Bolivia accounted for 9% and 6% of Brazil’s total rice exports during 2014 with 115,057 tons and 74,506 tons respectively.

Brazil’s National Grains Supply Company (Conab) has forecasted the country's 2014-15 paddy rice production at around 12.198 million tons (around 8.29 million tons, basis milled), slightly up from around 12.122 million tons (around 8.24 million tons, basis milled) in 2013-14.USDA estimates Brazil MY 2014-15 (April – March) paddy rice production at around 12.28 million tons (around 8.35 million tons, basis milled), slightly up from an estimated 12.2 million tons (around 8.3 million tons, basis milled) in MY 2013-14. It estimates Brazil’s 2014-15 paddy rice acreage at around 2.45 million tons, up about 2% from an estimated 2.4 million hectares in MY

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www.ricepluss.com 2013-14. USDA estimates Brazil to export around 900,000 tons of rice and import around 700,000 tons of rice in 2014.

Global Rice Quotes January 15th, 2015 Long grain white rice - high quality Thailand 100% B grade 415-425 Vietnam 5% broken 375-385 ↔ India 5% broken 395-405 ↑ Pakistan 5% broken 370-380 ↔ Cambodia 5% broken 450-460 ↔ U.S. 4% broken 510-520 ↔ Uruguay 5% broken NQ ↔ Argentina 5% broken NQ ↔ Long grain white rice - low quality Thailand 25% broken NQ ↔ Vietnam 25% broken 340-350 ↓ Pakistan 25% broken 325-335 ↔ Cambodia 25% broken 430-440 India 25% broken 360-370 ↑ U.S. 15% broken 495-505 ↔

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Long grain parboiled rice Thailand parboiled 100% stxd 405-415 Pakistan parboiled 5% broken stxd 400-410 India parboiled 5% broken stxd 385-395 U.S. parboiled 4% broken 580-590 ↔ Brazil parboiled 5% broken 570-580 ↔ Uruguay parboiled 5% broken NQ ↔ Long grain fragrant rice Thailand Hommali 92% 925-935 Vietnam Jasmine 505-515 ↓ India basmati 2% broken NQ ↔ Pakistan basmati 2% broken NQ ↔ Cambodia Phka Mails 805-815 Brokens Thailand A1 Super 320-330 ↔ Vietnam 100% broken 325-335 Pakistan 100% broken stxd 290-300 Cambodia A1 Super 355-365 ↔ India 100% broken stxd 300-310

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↔ ↔ ↑ Page 5 of 13

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www.ricepluss.com Egypt medium grain brokens NQ U.S. pet food 405-415 ↔ Brazil half grain NQ ↔

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All prices USD per ton, FOB vessel, oryza.com

Foreign Importers Blamed for Misusing Nigeria's New Rice Policy Jan 14, 2015

The Nigerian government had introduced a new rice policy in May last year, under which it would allow preferential import duty of 10% and a levy of 20% against an import duty of 10% and levy of 60% for foreign firms in order to encourage investment in local rice production and milling.

However, the government made it clear that the importation of rice should be limited to the national supply gap (of around 1.5 million tons) for import-grade rice as determined by the Ministry of Agriculture.

According to the Agriculture Minister, after a thorough filtration based on their Domestic Rice Production Plans (DRPPs), around 1.3 million tons of rice import quotas were allocated at the preferential levy to deserving companies.

Now, five foreign-owned rice producing companies are alleged to have altogether exceeded the government set import quotas by about 70%. Agriculture Minister was quoted as saying that two of these companies were allocated an import quota of around 223,902 tons and the remaining three were not allocated any quota as they lacked DRPPs. However, all the five companies Page 6 of 13

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www.ricepluss.com together imported around 732,556 tons of rice, nearly 70% more than their allocated quota of around 223,902 tons.

The Minister noted that the five companies need to pay N36.5 billion ($190 million) to the government as import tariff before January 15, 2015. "Nigeria cannot lose any revenue due to the economy. All companies who have imported rice above their allocated quotas must pay fully the amounts due to the treasury," the Minister was quoted as saying.He said the aim of the new rice policy was to encourage importers to invest in the country and contribute to an increase in local production. He added that the government would not spare any importer misusing the policy.

Nigeria is a net importer of rice and imports over 50% of its annual rice consumption needs. The government aims to reduce the national supply gap to zero by 2017 by achieving self-sufficiency in rice production.USDA estimates the country to produce 2.55 million tons of milled rice in the MY 2014-15 (October 2014 - September 2014) and import about 3.5 million tons. The country's consumption needs during the year are estimated at around 6.1 million tons.

India Rice Sellers Lower Some of Their Quotes; Other Asia Rice Quotes Unchanged Today Jan 14, 2015

India rice sellers lowered their quotes for 100% broken rice by about $5 per ton to around $295 $305 per ton today. Other Asia rice sellers kept their quotes mostly unchanged today.

5% Broken Rice Thailand 5% rice is quoted at around $405 - $415 per ton, about $30 per ton premium on Vietnam 5% rice shown at around $375 - $385 per ton. India 5% rice is quoted at around $390 $400 per ton, about $20 per ton premium on Pakistan 5% rice quoted at around $370 - $380 per ton.

25% Broken Rice Thailand 25% rice was last quoted at around $350 - $360 per ton, about $5 per ton premium on Vietnam 25% rice shown at around $345 - $355 per ton. India 25% rice is quoted at around $355 - $365, about $30 per ton premium on Pakistan 25% rice quoted at around $325 - $335 per ton.

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www.ricepluss.com Parboiled Rice Thailand parboiled rice is quoted at around $405 - $415 per ton. India parboiled rice is quoted at around $380 - $390 per ton, about $20 per ton discount to Pakistan parboiled rice quoted at around $400 - $410 per ton.

100% Broken Rice Thailand broken rice, A1 Super, is quoted at around $320 - $330 per ton, about $5 per ton discount to Vietnam 100% broken rice shown at around $325 - $335 per ton. India's 100% broken rice is shown at around $295 - $305 per ton, down about $5 per ton from yesterday and about $5 per ton premium on Pakistan broken sortexed rice quoted at around $290 - $300 per ton.

Indonesia Hopes for Zero Rice Imports in 2015 due to Adequate Stocks Jan 14, 2015

Indonesia's state buying agency Bulog is hoping that the country may not need to import rice in 2015 due to sufficient stocks with it, according to Bloomberg.According to Bulog, the country currently has around 1.7 million tons with it and is expecting around 600,000 tons of additional stocks in January 2015, around 1.2 million tons in February, around 3 million tons in March and around 1.9 million tons in April.

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www.ricepluss.com Also, there would not be any need for imports given the price stability and the government's aims to increase 2015 paddy rice production by about 4% to around 73.4 million tons (around 48.44 million tons, basis milled) from an estimated 70.61 million tons (around 46.65 million tons, basis milled) in 2014.The new President is keen on achieving self-sufficiency in rice production and ending rice imports within the next two years. For this purpose, the government has allocated around Rp 2 trillion ($163.8 million) and is planning to rehabilitate around one million hectares of tertiary irrigation channels for paddy production and distribute 25,000 tons of subsidized seeds and subsidized fertilizer for around one million hectares of paddy fields.

USDA estimates Indonesia to produce around 36.5 million tons of rice, basis milled (around 57.48 million tons, basis paddy) and import around 1.3 million tons of rice in MY 2014-15 (January 2015 - December 2015).

Oryza Overnight Recap - Chicago Rough Rice Futures Open Lower as Bearish Grains Weigh on Prices Jan 14, 2015

Chicago rough rice futures for Mar delivery are currently listed 2 cents per cwt (about $0.44 per ton) lower at $11.425 per cwt (about $252 per ton) ahead of floor trading in Chicago. The other grains are seen lower this morning: soybeans are currently seen 0.4% lower, wheat is listed about 1% lower and corn is currently noted about 1.5% lower.U.S. stock-index futures signaled a lower open on Wednesday, as retail sales for December disappointed and weak oil prices hit copper and mining stocks. Already sharply lower, stock futures fell harder after the Commerce Department reported retail sales slid the most in a year last month, down 0.9%. Falling oil prices continue to weigh on global equity markets. On Tuesday, the commodity fell near six-year lows, extending losses after trading lower for seven straight weeks. Meanwhile, copper prices also hit five-and-a-half-year lows overnight, causing severe selling in miners.

European equities fell sharply in morning trade, with London's FTSE dragged over 1% lower.

The Fed will also release its Beige Book today at 2pm ET. Import/export data and business inventories are also expected at 08:30 am ET and 10:00 am ET respectively. In other news, the World Bank on Tuesday lowered its global growth forecasts for 2015 and 2016 due to disappointing economic prospects in the euro zone, Japan and some major emerging economies that offset the benefit of lower oil prices. Gold is currently trading about 0.5% higher, crude oil is seen trading about 0.4% higher, and the U.S. dollar is currently trading about 0.5% lower at 8:30am Chicago time.

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Oryza Afternoon Recap - Chicago Rough Rice Futures Tumble as Market Breaks through Support to Chart Fresh Lows Jan 14, 2015

Chicago rough rice futures for Mar delivery settled 29.5 cents per cwt (about $7 per ton) lower at $11.150 per cwt (about $246 per ton). Rough rice futures charted another leg lower, extending recent losses and charting a fresh contract low as prices broke through the recent low of $11.395 per cwt (about $251 per ton) which had held for nearly two weeks. Today’s move is seen as yet another bearish signal and indicates that the market will likely move to test psychological support at the $11.000 per cwt (about $243 per ton) level. The other grains finished with mixed results today; Soybeans closed about 0.5% higher at $10.0925 per bushel; wheat finished about 1.9% lower at $5.3775 per bushel, and corn finished the day about 1.2% lower at $3.8100 per bushel.

U.S. stocks fell sharply on Wednesday, continuing losses into a fourth day, but came off session lows after the release of the Federal Reserve's Beige Book. Already sharply lower, stock futures fell harder ahead of the opening bell after the Commerce Department reported retail sales slid the most in a year last month, down 0.9%. A later economic report came in as expected, with U.S. business inventories rising 0.2% in November. The ongoing decline in the price of crude extended to metals, with the price of copper stumbling as the World Bank reduced its global growth forecast, pointing to soft expansion in Europe and China. After a 348-point drop, the Dow Jones Industrial Average was lately down 326.01 points, or 1.9%, at 17,287.67.

The S&P 500 dropped 32.39 points, or 1.6%, to 1,990.64, with materials and financials weighing the most among its 10 major industries, all of which were in decline. The Nasdaq shed 61.94 points, or 1.3%, to 4,599.53. Gold is trading about 0.4% higher, crude oil is seen trading about 4.5% higher, and the U.S. dollar is seen trading about 0.2% lower at about 1:00pm Chicago time.Tuesday, there were 576 contracts traded, up from 413 contracts traded on Monday. Open interest – the number of contracts outstanding – on Tuesday decreased by 5 contracts to 8,443

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Thai Rice Exports May Decline About 6.5% y/y to 10 Million Tons in 2015 Jan 14, 2015

Thailand's 2015 rice exports are expected to decline to around 10 million tons, down about 6.5% from around 10.7 million tons exported in 2014, as competitors lower prices amid competition as well as falling oil prices, Bloomberg quoted the President of the Thai Rice Exporters Association (TREA) as saying. The TREA President noted that most of Thailand's export destinations in Africa depend on oil exports for their income and falling crude oil prices has been putting a toll on the their incomes. In this situation, they are expected to lower rice imports this year, he told media sources.He however, said that Thailand's rice export prices are expected not to decline significantly and to stay close to the current level of around $405 - $410 per ton due to existing stocks in the country as well as adequate global supplies.

The Office of the Agricultural Economics (OAE) estimated output from the 2014-15 secondary/off-season crop at around 6.7 million tons (around 4.4 million tons, basis milled), down about 31% from around 9.75 million tons (around 6.4 million tons, basis milled) last year.

It estimates the country's paddy rice output for 2014-15 at around 33.8 million tons (around 22.3 million tons, basis milled), down about 8% from around 36.8 million tons (around 24.3 million tons, basis milled) last year. USDA estimates Thailand to produce around 31 million tons of paddy rice (around 20.5 million tons, basis paddy) and export around 11 million tons in MY 2014-15 (January - December 2015).

Myanmar Begins Formalities to Export Rice Legally to China Page 11 of 13

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www.ricepluss.com Jan 14, 2015

The Myanmar government is preparing itself to export rice legally to China, according to local sources."Tasks for starting rice exports are currently on our plate," the Myanmar Rice Federation (MRF) General Secretary was quoted as saying. He noted that delegations from the MRF, the Rice Millers' Association, Myanmar Rice & Paddy Traders Association, the Agriculture and Irrigation Ministry and the Commerce Ministry had visited China early this month and finalized Memorandum of Agreements (MoU)s with companies that agreed to buy rice from Myanmar during the 25th ASEAN Summit in November 2014.

The MRF is again planning to send a delegation of 10 exporting companies along with related documents to China to attend a meeting with the officials of the China Certification & Inspection Group (CCIC), COFCO Group and the companies that signed a Memorandum of Understanding (MoU) with the MRF earlier this month. The MRF reiterated that the CCIC is planning to set up an office in Rangoon soon in order to monitor the quality of Myanmar rice before exporting to China.Discussions about the new trade agreement between China and Myanmar came up after the Chinese Premier reportedly promised that China will import around 1 million tons of rice from Myanmar in 2015 at about $400 per ton as well as legalize rice imports through northern borders of Myanmar, which are currently considered illegal during the 25th ASEAN Summit.

China has been an important export market for Myanmar rice for the last couple of years.

Myanmar's rice exports to China (mostly through northern borders) increased almost 125 times since 2011, according to a report by the World Bank in June this year. Myanmar's illegal rice exports to China reached about 800,000 tons in the first nine months of FY 2014-15, according to local sources. The South-East Asian nation expects to export over 1.5 million tons of rice in FY 2014-15, up about 25% from around 1.2 million tons exported in FY 2013-14. USDA estimates Myanmar to produce 18.98 million tons of paddy rice (around 12.15 million tons, milled basis) and export around 1.4 million tons of rice in MY 2014-15 (January - December 2015).

Oryza U.S. Rough Rice Recap - Prices Continue Their Decline as Bids Drop with Futures Jan 14, 2015

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www.ricepluss.com The U.S. cash market was materially weaker today falling in sympathy with the steep sell-off in the futures market.Most bids continue to soften amid unimpressive demand while many farmers remain confident that prices will recover and as a result there was very little trading to report.

Vietnam Allocates $15 Million for Rice Sector Development Jan 14, 2015

The Vietnam government has allocated around VND322 billion (around $15.1 million) from the state budget towards the development of the rice sector, according to local sources.The Prime Minister reportedly decided to spend the amount in rice fields development and protection. The government has selected 18 regions across the country, including Ha Giang, Hai Phong , Nam Dinh, Ha Tinh and Ca Mau (VND24 billion), where rice fields need requisite development.

Recently, the Vietnamese government has been taking several measures to enhance the value of Vietnamese rice in the global market.In October 2014, the Ministry of Agriculture and Rural Development (MARD) had released a draft plan of Vietnam's rice-production restructuring strategy 2020 under which it aimed to increase production of higher quality rice as well as help increase income to farmers. It is also targeting to cut down the rice area to around 7 million hectares in the next six years from the current 7.8 million hectares. In November 2014, the government planned to sign a contract with the Philippines-based International Rice Research Institute (IRRI) to work towards redefining and reforming the existing rice strategy for the country.

However, experts suggested that the government should focus on developing a national brand for Vietnamese rice to increase its competitiveness in the world market as well as increase incomes of rice farmers.According to MARD data, Vietnam's 2014 paddy rice production is estimated at around 45 million tons (around 28 million tons, basis milled), up about 2% from around 44.2 million tons (around 27.5 million tons, basis milled) produced in 2013. The South-east Asian nation exported about 6.316 million tons of rice in 2014, down about 6% from about 6.71 million tons of rice exported in 2013, according to data from the VFA.

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