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Rice Production Forecast Lowered For China, Mexico, Russia
Global rice production in 2018/19 is projected at 487.4 million tons (milled basis), down 2.15 million tons from the previous forecast and 1.0 million tons below the year-earlier record.
There were three downward production revisions this month for 2018/19. First, China’s 2018/19 rice production forecast was lowered 2.3 million tons to 142.2 million tons, nearly 3 percent below a year earlier and the smallest since 2011/12.
Second, Mexico’s 2018/19 rice production forecast was lowered 27,000 tons to 178,000 tons based on a 5,000-hectare reduction in the area forecast to 40,000 hectares. Both area and production in Mexico are slightly below a year earlier. Third, Russia’s 2018/19 rice production forecast was reduced 20,000 tons to 630,000 tons based on Government of Russia data reporting slightly smaller area.
There was only one upward revision this month for 2018/19 production: Thailand’s 2018/19 rice production forecast was raised 0.2 million tons to a record 21.2 million tons, an increase of 4 percent from a year earlier.
There were only slight revisions to the 2017/18 global rice production forecasts – all in Latin America – with global production raised just 84,000 tons. The largest production revision for 2017/18 was a 101,000 ton increase in Argentina’s production to 891,000 tons based on a 6,000-hectare area increase to 198,000 hectares reported by the Government of Argentina.
With consumption exceeding production for the first time in 14 years, 2018/19 global ending stocks are projected to decrease 0.7 million tons to 143.2 million tons, the first decline since 2006/07.
The year-to-year decline in India’s rice stocks is largely due to higher domestic use and record exports. In addition to China, ending stocks of rice are projected to be higher than a year earlier in Bangladesh, Indonesia, the Philippines, Thailand, and the United States. The global 2018/19 stocks-to-use ratio is projected at 29.3 percent, down slightly from a year earlier.
Egypt and Nigeria Are Projected To Boost Imports in 2019
Global rice trade in 2019 is projected at a record 49.5 million tons, nearly unchanged from last month’s forecast but up 0.8 million from a year earlier and the third consecutive year of increasing global trade. On the 2019 export side, shipments are projected to be larger in 2019 from Cambodia, China, India, Paraguay, Thailand, and the United States. Thailand’s 0.5-million-ton increase to 11.0 million tons is the largest. Both China and India are projected to expand exports 0.2 million tons in 2019 and U.S. exports are projected to increase 0.15 million tons.
On the 2019 import side, purchases in 2019 are projected larger than a year earlier for Benin, Brazil, Burkina-Faso, Cameron, Cote d’Ivoire, Egypt, the European Union, Iraq, Iran, Kenya, Malaysia, Nigeria, Saudi Arabia, Senegal, and the United Arab Emirates.
These projected import increases are expected to be partially offset by several reductions, with 2019 imports projected to decline for Bangladesh, Ecuador, Indonesia, Madagascar, the Philippines, and Venezuela. Indonesia’s 2019 imports are projected to decline 0.8 million tons to 1.2 million tons due to a slightly larger crop and adequate domestic supplies.
There were no significant 2019 export revisions this month. On the 2019 import side, Global rice trade in 2018 is forecast at 48.7 million tons, down 245,000 from the previous forecast but up more than 1 percent from a year earlier. There were several important 2018 trade revisions this month, mostly based on shipment pace. On the export side, India’s 2018 export forecast was lowered 0.4 million tons to 12.8 million tons, with India still the largest exporter.
On the 2018 import side, Bangladesh’s 2018 import forecast was lowered 0.6 million tons to 1.2 million tons based on the recently announced reinstatement of the 25-percent tariff on rice imports, coupled with a 3-percent supplementary tariff, effective June 7, 2018.
In 2018, exports are projected higher than a year earlier for Argentina, Australia, Brazil, Burma, Cambodia, China, India, Pakistan, Paraguay, and Vietnam. China’s 2018 exports are projected to increase 0.43 million tons to 1.6 million, the largest since 2003.
Global Rice Trading Prices Decline; U.S. Prices Remain Firm
Price quotes for most grades of Thailand’s regular milled white rice dropped 2-3 percent over the past month, mostly due to a lack of new inquiries from buyers as traders wait for the results of the expected June 14-15 sale of the remaining 2.0 million tons of Government-held rice. These tenders will consist of 1.5 million tons of nonfood-quality rice and 0.5 million tons of deteriorated rice. Around 60 percent of these rice stocks are 5-percent broken white rice, mainly from the 2011/12–2012/13 market year pledging programs. The remainder consists of 100 percent broken white rice and fragrant rice, as well as glutinous rice.
For the week ending June 11, Thailand’s 100-percent grade B milled white rice was quoted at $437 per ton, down $9 from the week ending May 7. Prices for Thailand’s lower quality 15-percent brokens were quoted at $420 per ton for the week ending June 11, down $10 from the week ending May 7. In contrast, prices for Thailand’s premium jasmine rice—an aromatic—were quoted at $1,235 per ton for the week ending June 11, up $120 from the week ending May 7.
Price quotes for Vietnam’s rice decreased 2 percent over the past month, a result of harvest of the second 2018 rice crop in the Mekong Delta and reduced demand from top buyer China. For the week ending June 12, prices for Vietnam’s 5-percent broken, regular milled white rice were quoted at $455 per ton, down $10 from the week ending May 8. Vietnam’s prices are now about $23 per ton higher than for comparable grades of rice from Thailand. Vietnam’s rice typically sells at $30 to $50 below comparable grades of Thailand’s rice.
U.S. prices for long-grain milled rice were unchanged over the past month. For the week ending June 12, prices for high-quality U.S. Southern long-grain rice (No. 2, 4-percent brokens, bagged, free on board (fob) vessel, U.S. Gulfport) remain quoted at $620 per ton, unchanged since the start of May. The U.S. price difference over Thailand’s 100-percent Grade B milled rice rose to $183 per ton for the week ending June 12, up from $174 in early May but still almost $20 below record. Prices for U.S. long-grain rough-rice (bulk, fob vessel, New Orleans) were quoted at $315 per ton for the week ending June 12, down $15 from the first week of May. ∆
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