Oryza Weekly: Rice Market Recovers on Indonesia, Philippines Imports
Nov 07, 2015
The Oryza White Rice
Index (WRI), a weighted average of global white rice export quotes, ended the
week at about $393 per ton, up about $1 per ton from a week ago, down about $2
per ton from a month ago and down about $62 per ton from a year ago.
In October, the FAO
All Rice Price Index declined for the fourteenth consecutive month to around
199 points, about 3% lower than in September, and about 15.4% lower than a year
ago. The FAO index value in October 2015 is the lowest since June 2010.
Thailand
Thailand 5% broken
rice is today shown at about $355 per ton, up about $5 per ton each from a week
and month ago, and down about $60 per ton from a year ago.
During the first nine
months of 2015, Thailand exported around 6.6 million tons of rice, a decrease
of about 13% from the same period last year. In terms of value, Thai rice
exports earned about $3.155 billion, down about 15% from the same period last
year.
The government of Indonesia
has secured a G2G deal to import 500,000 tons of rice from Thailand. Indonesia
has decided to import 1.5 million tons of rice from Thailand and Vietnam before
March 2016 to replenish stocks.
The USDA Post
forecasts Thailand’s 2015 rice exports to decline to around 9 million tons,
down about 18% from 10.97 million tons in 2014, due to increased competition
from Vietnam and India.
The government of
Thailand is incurring about a billion baht (about $28 million) every month for
storing rice stocks.
Vietnam
Vietnam 5% broken rice
is today indicated at about $375 per ton, unchanged from a week ago, up about
$25 per ton from a month ago, and down about $105 per ton from a year ago.
The government has
increased its estimates for 2015 rice exports to around 7-7.5 million tons,
excluding border exports. This is an increase from earlier estimates of 6
million tons, according to the Vice-Head of Crop Production Dept. under the
Agriculture Ministry.
The Chairman of the
Vietnam Food Association has denied rumors that Vietnam rice exporters have
halted exports of low-quality 25% broken rice due to undersupply.
The State Logistics
Agency Bulog in Indonesia has been authorized to receive about
250,000-300,000 tons of medium-quality rice from Vietnam this month.
Cambodia 5% broken rice is today shown at about $420 per ton,
unchanged from a week and a month ago, and down about $50 per ton from year
ago. Cambodian fragrant rice, which won the world’s best rice competition for
the last three years, has lost its top position to Californian rice in the 7th
World Rice Competition held in Kuala Lumpur.
India
India 5% broken rice
is today shown at about $350 per ton, unchanged from a week ago, down about $10
per ton from a month ago, and down about $65 per ton from a year ago.
Despite earlier
reports that Iran’s Government Trading Corporation announced
that it will lift the ban on rice imports (which has been in place since
November 2014) starting this month, the Executive Director of the All India
Rice Exporters Association claims the Iranian embassy denies any such
development, and imports remain banned. Indian rice exporters expect Iran
to issue fresh basmati rice import permits starting next month.
The USDA Post
estimates India’s MY 2015-16 (October-September) rice exports will decline to around
9 million tons, down about 24% from estimates for MY 2014-15, due to
anticipated tight supplies. The USDA Post estimates MY 2015-16 rice
production at around 103 million tons, down from about 104.8 million tons in MY
2014-15.
India average wholesale
rice prices declined in October 2015 after increasing for two consecutive
months. The decline is attributed to increasing supplies from the ongoing
kharif (June-December) rice crop harvest.
Scientists of the
Central Rice Research Institute are developing a “climate smart” paddy variety
with multi-train gene packaging, which is capable of withstanding both drought
and flood.
Pakistan
Pakistan 5% broken
rice is today shown at about $320 per ton, down about $10 per ton each from a
week and month ago, and down about $80 per ton from a year ago.
Pakistan basmati rice
export prices have declined for the second consecutive month after increasing
in August, according to the UN’s FAO. The decline is due to increasing
supplies from the current harvest, lack of export demand, and surging stocks.
Central &
South America
Brazil 5% broken rice is today shown at about $500 per ton,
unchanged from a week and a month ago and down about $50 per ton from a year
ago. The Brazilian paddy rice index maintained by CEPEA reached around 40.8
real per 50 kilograms as of November 2, 2015, slightly up from around 40.6 real
per 50 kilograms recorded on October 26, 2015.
In terms of USD per
ton, the index reached around $216.5 per ton on November 2, 2015, up about 4%
from around $208.01 per ton recorded on October 26, 2015. Month-on-month,
the index has increased about 2% from about 39.91 real per 50 kilograms. In
terms of USD, the index increased about 4% during the month.
Five per cent broken
rice from Uruguay and Argentina is today shown
at about $535 per ton, unchanged from a week, down about $5 per ton a month
ago, and down about $65 per ton from a year ago.
Guyana is likely to secure a rice export contract with Mexico
shortly.
U.S.
U.S. 4% broken rice is
today shown at about $500 per ton, unchanged from a week ago, up about $35 per
ton from a month ago and up about $45 per ton from a year ago.
Taiwan has completed tender for 53,750 tons or about 83% of the
2015 U.S. rice country specific quota of 64,634 tons, according to the USDA Post.
Chicago rough rice
futures for January delivery climbed steadily this week, opening the week at
$11.935 per cwt (about $263 per ton) and continuously going up before reaching
the weekly high of $12.490 per cwt (about $275 per ton) on Friday. Futures
closed at $12.405 per cwt (about $273 per ton) on Friday afternoon.
The U.S. cash market
was mostly quiet this week, starting the week with no trading before firming up
in tandem with the futures market midweek. The cash market finished the
week quiet as everyone seems to be prepared to wait until next year to begin
trading again.
Other Markets
Rice stocks in the Philippines
have increased in October 2015 after declining for four continuous months,
according to the Bureau of Agricultural Statistics, which attributes the
increase to rising imports. However, the government may need to import
over 1.3 million tons of additional rice in 2016 following crop losses from
recent typhoons as well as the El Nino-induced dry weather conditions.
The government of Malaysia
has withdrawn its subsidized rice program ST15 rice (Super Tempatan 15%
broken), under which it provides subsidized rice to low-income families, after
finding “too many leakages” in the implementation of the program.
China has agreed to import rice from South Korea
as part of the ongoing bilateral summit between the Premiers of the two
countries.
The USDA Post
forecasts South Korea’s 2015 rice production will increase y/y
to about 4.26 million tons, despite a decline in acreage, due to increasing
yields.
The UN’s FAO forecasts
Bangladesh’s 2015 paddy rice output to reach a record 51.895
million tons, slightly above last year’s 51.793 million tons, despite a likely
decline in the Aman (mid-May to mid-December) rice crop, which accounts for
about 40% of the country’s total output.
One of the oldest
rice-milling companies in Europe, and FIR (Supply Italian Rice), a cooperative
owned by farmers’ union Coldiretti, have signed a new agreement at the end of
the Milan Expo to avoid paddy price volatility in Italy for
the next three years.
The USDA Post
estimates South Africa’s MY 2015-16 rice imports will increase
about 10% y/y to around 1.1 million tons, due to increasing demand.
The USDA Post
estimates Turkey’s MY 2015-16 (September-August) rice
production will be around 500,000 tons, up from last year’s 460,000 tons but
unchanged from USDA’s official estimates. The increase in production is
attributed to increased acreage reflecting higher water levels and firmer
prices.
The European
Parliament has decided to reject the European Commission’s trade proposal to
allow EU Member States to opt-out from authorized Genetically Modified
Organisms for food and feed uses.
The USDA Post
forecasts Bangladesh MY 2015-16 (May-April) rice production to
decline to around 34.6 million tons, due to flooding.
Thai Government Spends $28 Million Monthly for Storage of Rice Stocks, Says
Commerce Minister
Nov 06, 2015
The government of Thailand
is incurring about a billion baht (around $28 million) every month for storing
the rice stocks, local sources quoted the Commerce Minister as saying.
Responding to the
questions of the members of the National Legislative Assembly (NLA), the Minister
noted that since taking over in May 2014, the military government sold about 5
million tons of stockpiled rice raising about 52.3 billion baht (around $1.5
billion) and it is currently holding around 13.7 million tons.
She noted that the
government needs about billion baht (around $28 million) a month to store the
13.7 million tons of pledged rice. Warehouse rent, storage and maintenance
fees, fumigation, interest payments and insurance premiums are costs associated
with the rice storage.
The Minister noted
that the government is keen on releasing more rice in auctions but is planning
to halt auctions during November and December to support local paddy prices
during the harvest time. The government was supposed to auction 2 million tons
od rotten rice (for industrial use) in November and December.
She assured the
officials working on cases related to rice pledging scheme that the Section 44
of the interim charter would protect them from any kind of disciplinary or
legal charges (sometime in the future) for performing their tasks honestly.
Oryza CBOT Recap – Chicago Rough Rice Futures Finish the Day a Bit Lower,
Erasing Yesterday’s Gains
Nov 07, 2015
Chicago rough rice
futures for Jan delivery settled 1.5 cents per cwt (about $0.33 per ton) lower
at $12.44 per cwt (about $274 per ton). The other grains finished the day
mixed; Soybeans closed about higher at $8.6700 per bushel; wheat lower at
$5.222 per bushel, and corn finished the day lower at $3.730 per bushel.
U.S. stocks traded
sideways Friday. October nonfarm payrolls were up more than expected, raising
anticipation the Federal Reserve will hike interest rates in December. The Dow
Jones industrial average rose 46.9 points or 0.26% to 17,910.33; the S&P
500 lost 0.73 points or 0.03% to 2,099.2, and the Nasdaq Composite gained 19.38
points, or 0.38% to 5,147.12.
Friday, there were 357
contracts traded, down from 1,001 contracts traded on Thursday. Open interest –
the number of contracts outstanding – on Thursday fell by 233 contracts to
11,941.
Thailand Secures 500,000 Ton G2G Rice Export Deal from Indonesia
Nov 06, 2015
Thailand has secured a
500,000 ton government-to-government (G2G) rice export deal from Indonesia,
Bloomberg quoted a statement from the Ministry of Commerce.
Thailand will export
50,000 tons of 5% white rice and 450,000 tons of 15% broken white rice from the
new crop to Indonesia under the contract between November 2015 and March 2016.
The contract is expected to earn about 8 billion baht (around $224 million) to
the Thai government.
The Thai Ministry is
expected to sign an Agreement with Indonesia's state logistics agency Bulog
next week.
The statement also
noted that the government's rice sales under G2G contracts would reach around 2
million tons this year, including the Indonesian contract. It noted that the
Ministry has also signed a contract to export 300,000 tons of 25% broken white
rice to the Philippines. The Thai government has to export around 300,000 tons
of rice to China as part of a one million ton deal signed this year. The
government is likely to secure another contract to sell one million tons of
China for delivery in 2016.
Increased demand is
expected to firm up the Thai rice export prices, which are currently below the
Vietnam rice prices. Thai 5% rice is quoted at around $355 per ton compared to
Viet 5% rice quoted at around $375 per ton.
Pakistan Basmati Rice Export Prices Decline Sharply in October 2015
Nov 06, 2015
Pakistan basmati rice
export prices have declined for second consecutive month after increasing in
August 2015, according to the UN's Food and Agriculture Organization (FAO).
The decline can be
attributed to increasing supplies from the current harvest, lack of export
demand as well as surging stocks. Pakistan rice exporters reportedly hold
around 500,000 tons of basmati rice from last season. They have been urging the
government to intervene in the export market and support them. The exporters
are lobbying for a rice-energy barter trade with Iran and are keen on
increasing exports to China as part of efforts to boost exports.
In October 2015,
Pakistan's basmati rice export prices have declined by about 23% to around $661
per ton from around $855 per ton in September 2015, and down about 54% from
their year-ago levels of around $1,435 per ton. In terms of local currency,
average Pakistan basmati rice prices in October 2015 declined by about 22% to
around PKR 68,744 per ton from around PKR 88,065 per ton in September 2015, and
down about 52% from around PKR 143,787 per ton in October 2014.
Average Pakistan
basmati rice prices stood at around $886 per ton in the first ten months of
2015 (January - October), down about 36% from around $1,382 per ton recorded
during the same period last year.
Pakistan basmati
growers have also been urging the government to provide adequate support to
increase competitiveness of Pakistan's basmati rice in the global market.
Vietnam Rice Sellers Lower Some of Their Quotes Today; Other Quotes Remain
Unchanged
Nov 06, 2015
Vietnam rice sellers
have lowered their quotes for jasmine rice and glutinous rice by $5 per ton
each to around $465 - $475 per ton and $460 - $470 per ton respectively.
5% Broken Rice
Thailand 5% rice is
indicated at around $350 - $360 per ton about $20 per ton discount on Vietnam
5% rice shown at around $370 - $380 per ton. India 5% rice is indicated at
around $345 - $355 per ton, about $30 per ton premium on Pakistan 5% rice shown
at around $315- $325 per ton.
25% Broken
Rice
Thailand 25% rice is
indicated at around $345 - $355 per ton, about $10 per ton discount on Vietnam
25% rice shown at around $355- $365 per ton. India 25% rice is indicated at
around $325 - $335 per ton, about $40 per ton premium on Pakistan 25% rice
shown at around $285 - $295 per ton.
Parboiled Rice
Thailand parboiled
rice is indicated at around $350 - $360 per ton. India parboiled rice is
indicated at around $340 - $350 per ton, about $65 per ton discount to Pakistan
parboiled rice last shown at around $405 - $415 per
ton.
100% Broken Rice
100% Broken Rice
Thailand broken rice,
A1 Super is indicated at around $320 - $330 per ton, about $10 per ton discount
to Vietnam 100% broken rice shown at around $330 - $340 per ton. India's 100%
broken rice is shown at around $285 - $295 per ton, about $10 per ton premium
on Pakistan broken sortexed rice shown at around $275 - $285 per ton.
USDA Post Forecasts Bangladesh MY 2015-16 Rice Production to Decline Due to
Floods
Nov 06, 2015
USDA Post forecasts
Bangladesh's MY 2015-16 (May - April) rice production at around 34.6 million
tons, down about 400,000 tons from USDA's official estimates of around 35
million tons due to floods that occurred in the northern and southern
Bangladesh.
Floods are said to
have affected the Aman (May - December) rice production significantly as
213,346 hectares of arable land is damaged due to cyclone Komen and a strong
monsoon.
The Post also lowered
Bangladesh MY 2015-16 rice acreage to around 11.8 million hectares from USDA's
official estimates of around 12 million tons.
It is forecasting this
year's imports at around 600,000 tons, unchanged from USDA's official estimates
but nearly half of last year's imports of around 1.22 million tons. The
government is continuing with the 10% import duty, which was introduced from
May 1, 2015.
The government rice
stocks stood at around 1.26 million tons as of October 25, 2015, says the Post
citing the Ministry of Food.
The
Post reports that domestic rice prices increased due to concerns of lower
production
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