U.S. New Crop Price Discovery In Wait Mode?
U.S. RICE PRODUCERS
KATY, TEXAS
Louisiana is racing ahead in its harvest, cresting 50% complete this week, well ahead of its five-year average of only 22%. Despite the speed, getting milling reports has been difficult; the minor indications we have heard are positive. It’s normal for Louisiana to be well ahead of the rest of the industry, with the only other state even on the register being Texas at 13% harvested. Arkansas is just around the corner, and right now for the state, the Crop Progress report shows 19% Excellent, 47% Good, 27% Fair, 6% Poor, and 1% Very Poor. Arkansas has been trending above 70% for Good/Excellent all year, so it remains positive that the trend has continued into harvest.
The real news for our market this week is what’s going on in Brazil. The size of their crop has been a major factor in recent years, and there have been shocks to it. Initial estimates from Post were that the crop would be reduced by about 8% this year compared with last year. However, due to recent weather events and extremely high fertilizer costs, reports are showing up to an additional 10% loss, getting close to a 20% unforeseen supply-side shock. This has caused the Brazilian government to procure 305,000 metric tons in reserves, and resulted in a subsequent price increase of appx $25 pmt. Brazil is not alone in the reduction, as the entire Mercosur region is now expected to be off by as much as 15%. This development, coupled with our extremely short crop, could be the single bright spot in the pricing equation at the moment as the world (and Western Hemisphere) is working off a glut of long grain rice.
It would be natural for the invisible hand of the market to dictate more rice from the Middle and Far East to find its way into the Western Hemisphere, specifically South America, but this hasn’t happened yet. There has been strong support and demand in Central and South America for rice grown in the Western Hemisphere. Prices have firmed in support of this thesis, with Brazilian milled 5% quoted at $500pmt, Argentina at $440pmt, and Uruguay at $500pmt. This has helped with convergence of the U.S. crop in the right direction, i.e., lower-priced product moving up in our direction as opposed to our price dropping.
The FAO All Rice Price Index averaged 108.4 points in July 2026, virtually unchanged from June but 4.7 percent above a year earlier. In Asia, Indica export prices were generally firmer, the exception being Thailand, where weak demand and a depreciating baht eroded June's gains. Indian quotations found support from robust African parboiled demand despite a softer rupee, while Vietnamese prices climbed to 19-month highs on cost pressures and thinning supplies. In the Americas, attention stayed on the supply side: U.S. focus is on quality now that the 30% reduction is locked in, while in MERCOSUR, reduced returns and El Niño disruptions weighed on 2027/28 planting decisions.
Thai and Viet prices have certainly bumped up from a year ago, now sitting at $460pmt and $440pmt respectively. Recall that quotations were much closer to $380pmt this time last year, so an increase of nearly 20% has been the story, while India hasn’t moved off its $365pmt price.
The weekly USDA Export Sales report shows net sales reductions of 54,300 MT this week—a marketing-year low. Exports of 67,500 MT were up noticeably from the previous week and up 72% from the prior 4-week average. The destinations were primarily to Mexico (31,000 MT), Japan (13,000 MT), Saudi Arabia (9,700 MT), Honduras (6,400 MT), and Jordan (2,100 MT). ∆
U.S. RICE PRODUCERS