25th February (Wednesday),Daily Exclusive ORYZA Rice Newsletter by Riceplus Magazine

Brazil Paddy Rice Index Declines About 2% from Last Week

Feb 24, 2015

The Brazilian paddy rice index maintained by the Center for Advanced Studies on Applied Economics (CEPEA) reached around 36.78 real per 50 kilograms as of February 23, 2015, down about 2% from around 37.49 real per 50 kilograms recorded on February 17, 2015.In terms of USD per ton, the index reached around $255.4 per ton on February 23, 2015, down about 3.6% from around $255.4 per ton recorded on February 17, 2015.

Global Rice Quotes

February 24th, 2015

Long grain white rice - high quality

Thailand 100% B grade           415-425           ↔

Vietnam 5% broken     355-365           ↔

India 5% broken          390-400           ↔

Pakistan 5% broken     335-345           ↔

Myanmar 5% broken   410-420           ↔

Cambodia 5% broken 430-440           ↔

U.S. 4% broken           480-490           ↔

Uruguay 5% broken    NQ       ↔

Argentina 5% broken   NQ       ↔

Long grain white rice - low quality

Thailand 25% broken 365-375           ↔

Vietnam 25% broken   325-335           ↔

Pakistan 25% broken   305-315           ↔

Cambodia 25% broken            410-420           ↔

India 25% broken        355-365           ↔

U.S. 15% broken         470-480           ↔

Long grain parboiled rice

Thailand parboiled 100% stxd             405-415           ↔

Pakistan parboiled 5% broken stxd      385-395           ↔

India parboiled 5% broken stxd           385-395           ↔

U.S. parboiled 4% broken       555-565           ↔

Brazil parboiled 5% broken     570-580           ↔

Uruguay parboiled 5% broken             NQ       ↔

Long grain fragrant rice

Thailand Hommali 92%           920-930           ↔

Vietnam Jasmine         460-470           ↔

India basmati 2% broken         NQ       ↔

Pakistan basmati 2% broken    NQ       ↔

Cambodia Phka Mails 785-795           ↔

Brokens

Thailand A1 Super       320-330           ↔

Vietnam 100% broken             305-315           ↔

Pakistan 100% broken stxd     275-285           ↔

Cambodia A1 Super    365-375           ↔

India 100% broken stxd          280-290           ↔

Egypt medium grain brokens   NQ       ↔

U.S. pet food   380-390           ↔

Brazil half grain           NQ       ↔

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

Government of India Will Not Consider Recommendation to Increase MSP on Rice

Feb 24, 2015

The government of India today specified in the Parliament that it would not consider the recommendations of the National Commission on Farmers (NCF) to increase the minimum support price (MSP) on rice and wheat to at least 50% more than the weighted average cost of production, according to local sources.

The Junior Farm Minister apprised the Parliament in a written statement that the government has decided not to increase the MSP in line with the NCF's recommendations as it would distort markets. He also noted that the concept of MSP was recommended by the Commission for Agricultural Costs and Prices (CACP) after considering many objective factors and a variety of relevant factors.He specified that the government would implement all the other recommendations made by the NCF, which is chaired by the rice veteran M.S.Swaminathan, as well as is regularly monitoring the national policy for farmers announced by the previous government in 2007.

The government is also considering direct cash transfers in lieu of subsidized grains under the public distribution system, which means the government may limit the procurement and storage of food grains to strategic buffer norms.For the 2014-15 kharif marketing season (KMS), the government increased the MSP for common grade paddy by about 3.8% to around Rs.1,310 per quintal (around $218 per ton) and increased the MSP for Grade 'A' paddy by about 4% to around Rs.1,345 per quintal (around $223 per ton).

Indonesia to Release 400,000 Tons of Rice to Control Price Hikes, Says Vice-President

Feb 24, 2015

Indonesia's State Logistics Agency Bulog has decided to release about 400,000 tons of rice into the market to control price hikes, according to Bloomberg.The country's Vice-President told reporters that Bulog currently has 1.4 million tons of rice and can release another 500,000 tons if needed. He noted that the government is targeting to increase Bulog stocks to 3 million tons by the end of this harvest season. Bulog aims to procure about 3.2 million tons of rice in 2015.

The agency currently distributes rice at a fixed price of 7,400 Rupiah per kilogram (around $576 per ton) on the market.

Domestic rice prices have been surging since September 2014. According to data from the UN's Food and Agricultural Organization (FAO), local rice prices currently stand at around 9.78 million Rupiah (around $761) per ton, up about 10% from around 8.93 million Rupiah (around $750) per ton in September 2014, and up about 9% from their year ago levels.

The Vice-President reiterated that the government would not import rice despite surging prices ahead of the harvest season as the supply is expected to increase during the harvest time between March and May 2015.

Thai Finance Ministry Estimates Total Losses from Rice Pledging Schemes at $21.5 Billion

Feb 24, 2015

Thailand's Finance Ministry has estimated the total losses from 11 subsidy schemes covering 15 harvests from 2004-14 at around 700 billion baht (around $21.5 billion), according to Bloomberg. The Finance Permanent Secretary was quoted as saying that losses from the rice pledging scheme introduced by the Yingluck-led government alone amounted to around 536 billion baht (around $16.5 billion). He also noted that the estimated losses exclude 425,000 tons of rice, the quality of which could not be assessed by the government, and 130,000 tons that are missing.Thailand is planning to auction about one million tons of rice in early March. The Thai Commerce Ministry sold about 496,243 tons of rice from the one million tons auctioned on January 29, 2014. The government is planning to sell 10 million tons of rice this year and about 7 million tons next year.

Oryza Afternoon Recap - Chicago Rough Rice Futures Make Afternoon Recovery to Erase Early Losses but Remain Slightly Lower on the Day

Feb 24, 2015

Chicago rough rice futures for Mar delivery settled 2 cents per cwt (about $0.44 per ton) lower at $10.445 per cwt (about $230 per ton).  The other grains finished with mixed results; Soybeans closed about 1.7% higher at $10.1600 per bushel; wheat finished unchanged at $5.0575 per bushel, and corn finished the day about 0.3% lower at $3.7750 per bushel.U.S. stocks traded near highs on Tuesday as the first of Fed Chair Janet Yellen's two-day congressional testimonies indicated that a rate hike would likely come later rather than sooner. Stocks trimmed gains following the end of Yellen's remarks to the Senate Banking, Housing and Urban Affairs Committee. She will address the House Financial Services Committee on Wednesday.

Yellen's prepared remarks said no rate hike is expected for the next few FOMC meetings. She later said in a question-and-answer session that the Fed would not raise rates before it found confidence in the economic recovery, overcoming current concerns about the labor market, below-objective inflation and the decline in energy prices. The Dow Jones Industrial Average traded up 91 points, or 0.50%, to 18,207. The S&P 500 gained 4.5 points, or 0.21%, to 2,114, with telecommunications leading gains and energy and health care the greatest laggards. The Nasdaq gained 1 point, or 0.03%, to 4,692. Gold is trading about 0.2% lower, crude oil is seen trading about 0.6% higher, and the U.S. dollar is seen trading marginally lower at about  1:00pm Chicago time.Monday, there were 1,053 contracts traded, down from 1,573 contracts traded on Friday. Open interest – the number of contracts outstanding – on Monday decreased by 125 contracts to 9,048.

Oryza Overnight Recap – Chicago Rough Rice Futures Unable to Find Momentum Despite Firmer Grains and Crude

Feb 24, 2015

Chicago rough rice futures for March delivery are currently listed 1.5 cents per cwt (about $0.33 per ton) higher at $10.480 per cwt (about $231 per ton) during early floor trading in Chicago. The other grains are seen trading higher this morning; soybeans are currently seen about 1.8% higher, wheat is listed about 0.7% higher and corn is currently noted about 0.8% higher.U.S. stocks traded narrowly mixed at records on Tuesday ahead of the first of Fed Chair Janet Yellen's two-day congressional testimonies.

The Dow Jones industrial average traded modestly higher, touching a new intraday record. The S&P 500 also briefly hit records but struggled to stay in positive territory. The Nasdaq declined slightly. Yellen's prepared remarks said no rate hike is expected for the next few FOMC meetings. Yellen addresses the Senate Banking, Housing and Urban Affairs Committee on Tuesday and the House Financial Services Committee on Wednesday. Futures moved little on the news before the bell that Eurozone finance ministers officially approved a four-month bailout extension for Greece.

On the data front, the S&P/Case-Shiller composite index of home prices in 20 cities increased by 4.5% in December from the same period last year. The release of February's consumer confidence index at 10.00 a.m. will be of interest, with expectations for a retreat from the previous month's post-crisis high. The Dow Jones Industrial Average opened up 32 points, or 0.17%, to 18,147.73. The S&P 500 opened flat near 2,109.61, with consumer discretionary leading three sector gains and telecommunications the greatest laggard. The Nasdaq opened down 8.60 points, or 0.17%, to 4,952.  Gold is currently trading about 0.3% lower, crude oil is seen trading about 0.6% higher,  and the U.S. dollar is currently trading about 0.2% higher at 8:00am Chicago time.

Oryza U.S. Rough Rice Recap – Prices Dip Slightly as Farmers Look to Move Paddy Ahead of Planting

Feb 24, 2015

The U.S. cash market was slightly weaker today as some farmers look to move paddy ahead of spring planting while buyers remain mostly uninterested in this market.Analysts note that the mills have a good amount of business and will remain busy through April however without an uptick in paddy exports this market will struggle to find a bottom.

Nigeria Milled Rice Production Increases 52% y/y to 2.9 Million Tons in 2014, Says Agriculture Minister

Feb 24, 2015

Nigeria's milled rice production reached around 2.9 million tons in 2014, up about 52% from around 1.9 million tons produced in 2013, local sources quoted the country's Agriculture Minister as saying.

The Minister noted that the government's 'rice revolution' was gaining momentum with the development of the rice value chain, including subsidized inputs and mechanization services. The government has been promoting rice production on small, medium and large-scale through its Growth Enhancement Support Scheme (GESS) under the Agriculture Transformation Agenda (ATA), launched in 2011, he said.

He also noted that a number of private investors willing to invest in the country's rice sector. Already some of the investors have invested in rice mills at strategic locations to promote production and milling activities in captive areas. He added that the number of integrated rice mills increased from a mere one in 2011 to 13 in 2015, and the number of small mills increased about 40% during the period to about 4,350.

The Minister stated that if the 2014 output is added to the existing stock, the country would need to import around 1.9 to 2 million tons of rice this year to meet a consumption demand of around 6 million tons. The government initially planned achieve rice self-sufficiency and ban rice imports from 2015.

USDA estimates Nigeria to produce around 2.55 million tons of rice and import around 3.5 million tons of rice in MY 2014-15 (October – September).

Project Aims to Optimize Rice Production in Spain

Feb 24, 2015

A new project, called EBRO-ADMICLIM, by the LIFE+ Program of the European Union seeks to analyze the rice growing conditions in the Ebro Delta river region, which is the main rice growing area in Spain. Rice is cultivated in about 22,000 hectares in this region (about 21% of Spain's total rice acreage).The project, the first of its kind in Spain, mainly aims to suggest risk mitigation actions in rice cultivation, including optimization of greenhouse gases emissions and increasing ground elevation levels, while boosting the rice production.

The project will mainly study the effectiveness of reducing greenhouse gas emission (GHGs) through airing the soil at specific times. The process is said to mitigate GHG emissions to a large extent but was not evaluated earlier. The project aims to carry out the process in different agricultural conditions, including different flooding levels, different fertilizer combinations, etc, in about 10 to 15 experimental rice fields during harvest and post-harvest time in the 2014-15 and 2015-16 crop years (September - August).

The project implementation is coordinated by the Institute of Food and Agriculture Research and Technology (Institut de Recerca i Tecnologia Agroalimentàries, IRTA) and is supported by the Consortium for dealer councils and water industries of Tarragona  (Consorci Concessionari d’Aigües per als Ajuntaments i Indústries de Tarragona (CAT), Irrigation Farmers’ Association and Ebro Farmers’ Union (Comunitat de Regants i Sindicat Agrícola de l’Ebre, CRSAE), Cartographical and Geological Institute of Catalonia (Institut Cartogràfic i Geològic de Catalunya, ICGC), Catalan Office for Climate Change (Oficina Catalana del Canvi Climàtic, OCCC), Cordoba University (Universidad de Córdoba, UCO).

Guyana Facing Challenges in Finding Lucrative Export Markets, Says President

Feb 24, 2015

The government of Guyana is facing challenges in finding lucrative markets for its rice, according to the country's President Donald Ramotar.Local sources quoted him as saying that despite the country's rice sector has developed quickly, it is facing "monumental difficulties in finding regional and international markets, especially at a price that is acceptable." He added that production had gone up at a very fast pace and beyond expectations due to the farmers' hard work but sourcing markets has become a major challenge.

An Agriculture Ministry Official noted that finding markets at right price has turned into an uphill task for the government. “We have many, many markets, but most of the time, the prices offered by the various countries are not satisfactory,” he was quoted as saying.According to the Minister, prior to 2010, Europe was a major importer of Guyana's rice but as Venezuela's share in Guyana's market increased, the government paid less attention to the Caribbean and the European markets. Guyana signed a Petro-Caribe Deal with Venezuela to export rice and import oil. However, due to problems at home, Venezuela's share in Guyana's rice exports has not been so phenomenal.Realizing this development, the government again restarted negotiations with some of its old markets as well as struck deals with Panama, Belize and Haiti for the first time last year.

Guyana aims to produce about 618,000 tons of milled rice and export around 521,000 tons in 2015. Guyana has exported around 501,208 tons of rice in 2014, up about 27% from around 394,000 tons exported in 2013, according to the Agriculture Minister.

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25thFebruary (Wednesday),Daily Exclusive ORYZA Rice Newsletter by Riceplus Magazine