24th December (Wednesday),2014 Daily Exclusive ORYZA E-Newsletter by Riceplus Magazine

Oryza U.S. Rough Rice Recap – Prices Hold Amid Limited Trading Due to Christmas Holiday; IGB Tender Results Highly Anticipated

Dec 23, 2014

The U.S. cash market was unchanged today with little trading to report as many the industry had already checked out for the Christmas Holiday.Analysts contend that both buyers and sellers went to the sidelines in advance of the results of the latest Iraqi Grain Board tender which are expected to be announced Friday, December 26^th, when many in the industry will still be on vacation.Many in the industry believe that the IGB buys at least one cargo of rice out of the 105,000 MT offered from the U.S. that it could be the catalyst for higher prices.

Global Rice Quotes

December 23rd, 2014

Long grain white rice - high quality

Thailand 100% B grade           420-430           ↔

Vietnam 5% broken     385-395           ↔

India 5% broken          385-395           ↔

Pakistan 5% broken     370-380           ↔

Cambodia 5% broken 460-470           ↔

U.S. 4% broken           510-520           ↔

Uruguay 5% broken    595-605           ↔

Argentina 5% broken   595-605           ↔

Long grain white rice - low quality

Thailand 25% broken NQ       ↔

Vietnam 25% broken   350-360           ↔

Pakistan 25% broken   330-340           ↑

Cambodia 25% broken            435-445           ↔

India 25% broken        350-360           ↔

U.S. 15% broken         495-505           ↔

Long grain parboiled rice

Thailand parboiled 100% stxd             405-415           ↔

Pakistan parboiled 5% broken stxd      395-405           ↔

India parboiled 5% broken stxd           375-385           ↔

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%           890-900           ↔

Vietnam Jasmine         525-535           ↔

India basmati 2% broken         NQ       ↔

Pakistan basmati 2% broken    NQ       ↔

Cambodia Phka Mails 820-830           ↔

Brokens

Thailand A1 Super       330-340           ↔

Vietnam 100% broken             330-340           ↔

Pakistan 100% broken stxd     300-310           ↑

Cambodia A1 Super    385-395           ↔

India 100% broken stxd          295-305           ↓

Egypt medium grain brokens   NQ       ↔

U.S. pet food   390-400           ↔

Brazil half grain           NQ       ↔

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

Oryza Afternoon Recap – Chicago Rough Rice Futures Give Back Some of the Mid-day Gains to Close Slightly Higher

Dec 23, 2014

Chicago rough rice futures for Jan delivery settled 2.5 cents per cwt (about $1 per ton) higher at $12.185 per cwt (about $271 per ton). Rough rice futures finished the day slightly higher as the market gave up mid-day gains in afternoon trading. The market remains quiet and will likely remain so as the market trades through the next two holiday shortened weeks. The other grains closed flat to higher today; Soybeans closed unchanged at $10.3850 per bushel; wheat finished about 1.6% higher at $6.3550 per bushel, and corn finished the day about 0.6% higher at $4.1400 per bushel.

U.S. stocks furthered record gains on Tuesday, with the Dow Jones Industrial Average surpassing 18,000 for the first time, as investors embraced data that had the economy expanding in the third quarter by the most in 11 years. The Nasdaq, however, erased initial gains and turned lower, with biotechnology names weighing on the index. After rising as much as 109 points, the Dow Jones Industrial Average more recently rose 103.03 points, or 0.6%, to 18,062.47. Also rising to an intraday record and on track for a 51st record finish of the year, the S&P 500 was lately up 5.7 points, or 0.3%, at 2,084.25, with financials pacing gains and health care the sole laggard among its 10 main sectors. Erasing gains, the Nasdaq slid 9.71 points, or 0.2%, to 4,771.71. Tuesday's economic reports had the U.S. economy soaring by 5% in the third quarter, the most rapid pace since the same period of 2003, while a separate report had orders for durable goods unexpectedly dropping in November. Gold is trading about 0.4% lower, crude oil is seen trading about 3.9% higher, and the U.S. dollar is seen trading about 0.4% higher at about  1:00pm Chicago time.Monday, there were 1,754 contracts traded, down from 2,116 contracts traded on Friday. Open interest – the number of contracts outstanding – on Monday decreased by 160 contracts to 9,879

Pakistan Rice Sellers Increase Some of Their Quotes Today; India Rice Sellers Lower Some of Their Quotes

Dec 23, 2014

Pakistan rice sellers increased their quotes for 25% broken rice  and 100% broken rice by about $5  per ton each to around $330 - $340 per ton and $300 - $310 per ton respectively today. 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.

5% Broken Rice

Thailand 5% rice is quoted at around $405 - $415 per ton, about $20 per ton premium on Vietnam 5% rice shown at around $385 - $395 per ton. India 5% rice is quoted at around $385 - $395 per ton, about $15 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, on par with Vietnam 25% rice shown at around $350 - $360 per ton. India 25% rice is quoted at around $350 - $360, about $20 per ton premium on Pakistan 25% rice quoted at around $330 - $340 per ton, up about $5 per ton from yesterday.

Parboiled Rice

Thailand parboiled rice is quoted at around $405 - $415 per ton. India parboiled rice is quoted at around $375 - $385 per ton, about $20 per ton discount to Pakistan parboiled rice quoted at around $395 - $405 per ton.

100% Broken Rice

Thailand broken rice, A1 Super, is quoted at around $330 - $340 per ton, on par with Vietnam 100% broken rice shown at around $330 - $340 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 discount to Pakistan broken sortexed rice quoted at around $300 - $310 per ton, up about $5 per ton from yesterday.

Myanmar May Export Over 1.5 Million Tons of Rice in FY 2014-15; Up 25% from Last Year

Dec 23, 2014

Myanmar is expected to export more than 1.5 million tons of rice in FY 2014-15 (April - March), up about 25% from around 1.2 million tons exported last year, the Myanmar Rice Federation (MRF) Joint Secretary was quoted as saying to local sources.Myanmar exported around 799,600 tons of rice in the first eight months (April - November) of FY 2014-15, up about 75% from around 455,800 tons exported during the same period last year, according to local sources.

The South East Asian nation's rice exports slowed down significantly between August and November this year after China had officially banned rice imports through Myanmar's northern borders. Though rice exports through the northern  borders is considered to be legal from Myanmar's point of view, Chinese authorities have been treating these cross border imports as illegal as there is no formal rice export agreement between China and Myanmar. China is also understood to have promised to lower border tax on imports from Myanmar.

Myanmar government had held talks with the Chinese authorities to chart a formal trade agreement between the two countries. In November, on the sidelines of the ASEAN summit, the Chinese Premier promised to import one million tons of rice from Myanmar in 2015 as well as legalize imports through borders.The MRF Joint Secretary noted that the Chinese authorities began loosening controls on rice imports from Myanmar borders since mid-November though they have not publicly explained the patch up.

He added that exports to China have been picking up since then and he expects more exports to China in the next three months of this financial year. Myanmar is likely to export 200,000 tons of rice formally to China this month. Of this, 100,000 ton would be exported through the borders and remaining would be exported through the sea.He also told local sources that exports to European and African destinations have also increased considerably. The government is also negotiating with the governments of many other countries to expand its export market. He added that negotiations with Sri Lanka had completed recently.

 The Myanmar government is keen on increasing rice exports to around 3 million tons in the next few years and is planning to prioritize rice in its National Export Strategy, which is likely to be released in January 2015.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).

Thanks and Regards,

Pakistan Hopes to Resume Basmati Rice Exports to Mexico

Dec 23, 2014

Pakistan rice exporters are hopeful of resuming basmati rice exports to Mexico, which banned basmati rice shipments from Pakistan in June 2013 after finding traces of Khapra beetle in some shipments of Pakistan, according to local sources.Officials from the Trade Development Authority of Pakistan (TDAP) are understood to have met a two-member Mexican rice quarantine delegation few days back to discuss over possible resumption of basmati rice exports from Pakistan. The delegation has also reportedly visited and inspected various rice facilities to ensure that processing, storage, packing and quality assurance were in line with Mexico's requirements.

The TDAP officials met with the Mexican authorities after members from the Rice Exporters Association of Pakistan (REAP) sought their support in regaining the lost export share in Mexico, which produces only 17% of its annual consumption needs of around 890,000 tons, basis milled, and imports the rest.Mexico's rice imports from Pakistan increased significantly during the first five months of 2013. During this period, Pakistan rice constituted about 23% of Mexico's total rice imports. Pakistan exported around 16,000 tons of rice to the Central American country during January - May 2013 (before the ban), twice from around 7,400 tons exported during the same period in 2012.

Pakistan exported around 1.35 million tons of rice (around 239,773 tons of basmati and around 1.11 million tons of non-basmati) in the first five months of FY 2014-15 (July 2014 - June 2015), up about 16% from around 1.16 million tons exported during the same period in FY 2013-14. The South Asian nation is reportedly exploring new export markets such as Cuba, Brazil, Chile, Haiti, Puerto Rico and Peru

Venezuela Announces Subsidy for Paddy Rice Production

Dec 23, 2014

The Venezuelan government has announced it will subsidize paddy rice prices at about 6.10 bolivars per kilogram (around $960.69 per ton), according to Bloomberg.The subsidy details have been published in the official gazette number 40,567 and the subsidy is applicable in the states of Barinas and Portuguesa.The subsidies are expected to provide some relief to rice farmers who have been complaining of inadequate agricultural inputs and prevailing price controls are hindering rice production in the country. Recently, in November, the government fixed maximum retail price (MRP) of rice at around 9.63 Bolivars per kilogram (around $1,532 per ton) for the producer in order to help them increase their incomes.

The government also announced subsidies of around 4.80 bolivars per kilogram (around $755.95 per ton) and around 4.10 bolivars per kilogram (around $645.71 per ton) of white and yellow corn respectively.USDA estimates Venezuela paddy rice production to decline to around 560,000 tons (around 380,000, basis milled) in MY 2014-15 (April - March), down about 1% from an estimated 567,000 tons (around 385,000 tons, basis milled) in MY 2013-14. It also expects Venezuela rice imports to increase to around 425,000 tons in 2015, up about 36% from an estimated 312,000 tons last year. USDA estimates Venezuela rice exports to increase to around 150,000 tons in 2015, up about 50% from an estimated 100,000 tons last year.

Thailand Government Urged to Improvise Rice Selling Procedures

Dec 23, 2014

The Honorary President of the Thai Rice Exporters Association (TREA) has urged the Thailand government to improve procedures for selling rice stocks in order to avoid unnecessary downward pressure on prices, according to local sources.He noted that the government should on a priority basis exclude rotten rice stocks from the warehouses and inform the market about the exact amount of government's rice stocks. He said by doing so, there would be a correction in rice prices and help the market return to normalcy. Hasty sales by the government will only push down the prices and will not lead to a significant increase in prices, he said.

He reportedly made these suggestions after the Thai Prime Minister told local sources that his government is keen on selling the existing 17 million tons of rice stocks in the government warehouses within the next two to three years to both domestic and overseas traders.The TREA Honorary President also expressed concern that selling rice stocks to overseas buyers may not be so easy next year due to an expected increase in supplies by other exporting nations such as India and Vietnam. While the Commerce Ministry is expecting to export around 10.5 million tons of rice in 2015, he is predicting exports of around 10 million tons.

The National Rice Policy Committee, headed by the Prime Minister, acknowledged that there are about 17.8 million tons of rice stocks, of which 2.35 million tons are of good quality, 14.4 million tons are sub-standard, around 694,000 tons are rotten and around 390,000 are missing.

The government auctioned about 400,000 tons of rice in the fourth auction on December 22, 2014 and approved sale of about 250,000 tons. It sold around 348,000 tons of rice worth 3.6 billion baht (around $81 million) in the last three auctions.  The Director-General of the Foreign Trade Department noted that is planning to sell state rice stocks on a continuous basis until next March, when new supply from the second crop enters the market.

 

 

Vietnam Foresees Stiff Competition in 2015 for G2G Rice Sales

Dec 23, 2014

Vietnam's rice exports to the concentrated or G2G markets, to which Vietnam sells rice under government-to-government (G2G) deals, are expected to decline in 2015 due to an expected stiff competition between the top rice exporting countries including Thailand and India, according to local sources.Vietnam normally sells rice under G2G contracts to China, Malaysia, Indonesia and the Philippines. Demand from these three countries is likely to reach around 2.5 million tons next year, but none of them has so far signed contracts with the Vietnamese rice exporters, said the Director General of Vietnam's state-owned rice exporter Southern Food Corporation (Vinafood 2).

He told local sources that they are expecting lesser orders next year due to a strong competition in the market. He noted that they are particularly concerned of Thailand who is likely to offload huge amount of stocks from the government warehouses into the market next year.The official said it is difficult to predict next year's target exports particularly because of the instability of the Chinese market. Vietnam had been relying too much on China for the last couple of years. But it is understood that China has agreed to buy around 2 million tons of rice from Thailand and around 1 million tons of rice from Myanmar next year.

An official from the Vietnam Food Association (VFA) added that Vietnamese exporters have not been able to clinch any deals with African countries, which import nearly 14 million tons of white rice annually. Vietnam could not penetrate East African market and has very little presence in West African countries like Ghana and Ivory Coast. He noted that too many varieties of rice varieties within the common white rice market is diluting Vietnam's rice competitiveness.

Rice export prices in all the top exporting countries have been declining for the last couple of months due to increasing supplies from ongoing harvests and increased competition. Export prices of Viet 5% broken rice currently stand at around $390 per ton, down about 10% from around $435 per ton in the first week of November. Similarly prices of Thai 5% rice declined about 2.4% to around $410 per ton, India 5% rice declined about 6% to around $390 per ton and Pakistan 5% rice declined about 6.25% to around $375 per ton during the same period.  Vietnam is targeting to export around 6.5 million tons of rice in 2014. It has exported around Vietnam exported about 5.961 million tons of rice in January 1 - December 18, 2014, according to the VFA. It exported around 6.71 million tons of rice exported in 2013.

Nepal 2014-15 Rice Imports Forecasted to Increase 11% y/y to 500,000 Tons

Dec 23, 2014

The UN's Food and Agriculture Organization (FAO) has forecasted Nepal 2014-15 (July - June) rice imports to surge to around 500,000 Tons, up about 11% from around 450,450 tons in 2013-14 due to an expected decline in 2014 production and sustained demand.In its latest country brief on Nepal, the FAO estimates the South Asian nation's total 2014-15 cereal, including rice, imports to increase by about 10% to around 571,800 tons from last year's 519,818 tons.

The UN agency estimates Nepal 2014 paddy production at around 4.6 million tons (around 3.1 million tons, basis milled), down about 9% from around 5 million tons (around 3.35 million tons, basis milled) due to an estimated 6% decline on planted area as a result of late and below-average monsoon rains, which delayed sowing process and thereby leading to reduced yields. Floods and landslides across Mid-Western and Far-Western regions of the country further added to losses in rice production.Harvesting of the 2014 main season rice crop (April - December) was completed by mid-December.

USDA estimates Nepal’s MY 2014-15 (October 2014 – September 2015) paddy rice production to decline to about 4.655 million tons (around 3.1 million tons, basis milled) from an estimated 5 million tons (around 3.36 million tons, basis milled) in MY 2013-14. It estimates Nepal to import 300,000 tons of rice in 2014 and around 350,000 tons of rice in 2015.   

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