Planting Continues, Prices Stagnate
US RICE PRODUCERS
KATY, TEXAS
The updated crop progress report shows Arkansas at 24% planted and 7% emerged. Louisiana is at 82/65, Mississippi at 25/7, Missouri at 6/0, and Texas at 70/51. Overall, we are ahead in both plantings and emergence when we look at the 5-year average, but we are slightly behind last year’s pace. Rice producers are the eternal optimists, because as planting is fully underway, bids are light and prices are below break-even. It will take significant market changes to reverse the trajectory the market is on at the moment.
In Asia and India, prices continue to plummet as the competition for exports is in extreme measures, with supply being so plentiful. Thailand is still at $395 pmt, Vietnam at $400 pmt, and India at $385 pmt. This is putting extreme pressure on the entire rice exporting complex, where the strong harvest in the Mercosur is seeing light demand and high yields.
Prices on the ground here in the U.S. haven’t moved much in the past month, and if they have, it’s been in the wrong direction. Prices in Texas have been holding at $12.50-$13 for over a month, as has Louisiana at $13. But Mississippi, Arkansas, and Missouri have all dipped in the last week, now reported at $11.75-$12.00. There doesn’t appear to be any direct factor to boost these numbers in the short term, outside of tariffs slowing exports on Thai Jasmine (36% tariff) and Indian Basmati (26% tariff), thereby boosting domestic demand.
We will close this week with a brief update on the medium grain market, where prices remain in the doldrums. The wet winter was leaving open the possibility for reduced acreage from not being able to get into the field for the planting window in California, but warm, dry weather has prevailed, and the expectation as of this writing is for a full crop. Medium grain is not immune to the below break-even price of long grain, and this year’s poor milling yields, above average carry out, and the looks of a full plant don’t bode well for significant price increases. Currently, the cash market for medium grain in California is called at $10/cwt over loan ($16.50 net). These prices will trigger ARC/PLC payments in California for the first time in years. ∆
US RICE PRODUCERS