China Seeks to Boost Rice
Production Amid Challenges of Increasing Consumption, Environmental Pollution
Sep
03, 2015
China is seeking to boost rice production to meet rising consumption demand
but increasing levels of soil and water pollution are posing great challenges
to the East Asian country, say analysts.An article in the Nikki Asian Review
analyses the challenges faced by China in boosting yields and quality of rice
production in the light of rapid conversion of farmland to industrial use
coupled with soil pollution and water shortages.
The Director for Asia Studies at the New York-based Council on Foreign
Relations recently warned in a commentary that "soil contamination, like
air and water pollution, exacts a heavy economic and political toll on the
Chinese people." She stated that China produces at least 12 million tons
of heavy metal-contaminated rice worth about $3.2 billion annually. Officials
also discovered high levels of cadmium in rice from Hunan Province, the center
of Chinese rice production.
The U.N. Economic and Social Commission for Asia and the Pacific (Unescap)
noted in a recent report that China faces pressures to maintain quality in the
context of heavy industrialization. "It also must balance water
resources across key sectors, as well as meet increased per capita
demand," it said.
The U.N.'s 2015 World Water Development Report also noted that intensive
irrigation in the Northern provinces has lowered the water table by more than
40 meters since 1960.
In 2014, the Ministry of Environmental Protection and the Ministry of Land
Resources noted in a report that 16.1% of the country's soil was polluted,
including 19.4% of farmland.
China is reportedly taking measures to address the pollution and water
problems. In April 2015, the government came up with the Action Plan for Water
Pollution Prevention and Control. Under this it aims to achieve significant
improvements in water quality by 2020, including containing ground water
pollution. The Ministry of Environmental Protection will introduce a new soil
pollution prevention law from 2017.
From the production angle, the government is also trying to increase rice
production with the help of the Philippines-based International Rice Research
Institute. The IRRI is researching improves rice varieties that can produce
higher yields in spite of environmental challenges.
However, analysts expressed concern that China's rice imports are
increasing significantly to meet the demand. Unofficial imports are increasing
due to wide price differentials between domestic and international prices.
Smuggling is understood to take place through the borders of Vietnam, Myanmar,
Thailand and Laos with the connivance of Chinese authorities. Nearly 4-5
million tons of rice is said to enter China unofficially every year.
Experts are estimating that unofficial imports would increase because of
the soil and water pollution issues. They also expressed concern that increased
imports would lead to higher global rice prices.
According to the data from the International Grains Council (IGC), China's
milled rice production is estimated to increase to around 144.6 million tons
from an estimated 142.5 million tons in 2014. China is expected to import
around 4 million tons officially in 2015 compared to around 3.7 million tons in
2014. Production and imports are likely to increase to around 145.6 million
tons and 4.2 million tons respectively in 2016.
Asia Rice Quotes Mixed Today
Sep
03, 2015
Thailand rice sellers kept their quotes mostly unchanged today. Vietnam
rice sellers increased their quotes for 25% broken rice and 100% broken rice by
about $10 per ton each to around $320-$330 per ton and $315-$325 per ton
respectively and lowered their quotes for Jasmine rice by about $5 per ton to
around $450-$460 per ton. India rice sellers increased their quotes for 100%
broken rice by about $5 per ton to around $300-$310 per ton. Pakistan rice
sellers lowered most of their quotes by about $5 per ton today.
5% Broken Rice
Thailand 5% rice is indicated at around $350 - $360 per ton, about $25 per
ton premium on Vietnam 5% rice shown at around $325 - $335 per ton. India 5%
rice is indicated at around $365 - $375 per ton, about $50 per ton premium on
Pakistan 5% rice shown at around $315 - $325 per ton, down about $5 per ton
from yesterday.
25% Broken Rice
Thailand 25% rice is shown at around $335 - $345 per ton, about $15 per ton
premium on Vietnam 25% rice shown at around $320- $330 per ton, up about $10
per ton from Tuesday. India 25% rice is indicated at around $340 - $350 per
ton, about $50 per ton premium on Pakistan 25% rice shown at around $290 - $300
per ton, down about $5 per ton from yesterday.
Parboiled Rice
Thailand parboiled rice is indicated at around $355 - $365 per ton. India
parboiled rice is indicated at around $355- $365 per ton, about $60 per ton
discount to Pakistan parboiled rice last shown at around $415 - $425 per
ton.
100% Broken Rice
Thailand broken rice, A1 Super, is indicated at around $310 - $320 per ton,
about $5 per ton from discount to Vietnam 100% broken rice shown at around $315
- $325 per ton, up about $10 per ton from Tuesday. India's 100% broken rice is
shown at around $300 - $310 per ton, up about $5 per ton from yesterday and
about $25 per ton premium on Pakistan broken sortexed rice shown at around $275
- $285 per ton, down about $5 per ton from yesterday.
Pakistan to Export Rice to Iran
in Exchange for Electricity Payments
Sep
03, 2015
Pakistan has agreed to export rice
to Iran in exchange for dues payable for imported electricity, Bloomberg quoted
ta statement by the Finance Ministry.Pakistan will reportedly continue to
purchase about 74 megawatts of energy from the Iranian company Tavanir. The
deal is understood to be finalized by the Pakistani delegation that is visiting
Iran.
The development would be a welcome
news to Pakistani rice exporters who are struggling with increasing stocks,
declining demand and falling prices. Iran is one of the largest importers of
rice accounting for about 11% of the world's annual rice imports. Pakistani
rice has a good reputation in Iran according to traders. Moreover, geographical
proximity between the two nations is an added advantage for Pakistan rice
exporters, say traders.
However, exporters say in order to ensure smooth export procedures with
Iran, a proper currency transfer system is necessary. Pakistan's trade was
routed through the Bank of New York (BNY). But due to sanctions, the U.S.
suspended the trade route through the BNY.
Bangladesh 2014-15 Milled Rice
Production Reaches Record High
Sep
03, 2015
Bangladesh's FY 2014-15 (July 2014 - June 2015) milled rice production
reached a record high of around 34.708 million tons, slightly up from around
34.41 million tons in 2013-14, local sources quoted provisional data by the
Bangladesh Bureau of Statistics (BBS).
According to the BBS data, output from the Aman crop (July - December)
stood at around 13.19 million tons, up about 1.28% from around 13 million tons
last year; output from the Aus crop (February - August) stood at around 2.328
million tons, up about 0.8% from around 2.3 million tons last year; and output
from the 2014-15 Boro rice crop (January - May) stood at around 19.19 million
tons, up about 0.63% from around 19.07 million tons last year. Boro, Aman and
Aus contribute to about 56%, 38% and 6% respectively to the total country's
output.
Paddy rice acreage in 2014-15 stood at around 11.415 million hectares,
compared to around 11.373 million hectares in 2013-14, as per the estimates
from the Bangladesh Space Research & Remote Sensing Organisation (SPARSO).
Favourable weather conditions and supply of quality inputs in time were the
keys to the growth said the Director of the Department of Agriculture Extension
(DAE).
The country reportedly imported about 1.45 million tons of rice during FY
2014-15, about four times more higher than in 2013-14, despite a record
production due to prevailing low global rice prices, according to the Ministry
of Food.
USDA estimates Bangladesh’s MY 2015-16 (July 2015 – June 2016) milled rice
production at around 35 million tons, slightly up from an estimated 34.5
million tons in MY 2014-15. It estimates Bangladesh to import around 1.2
million tons of rice in 2015.
Global Rice Quotes
September
4th, 2015
Long grain white rice - high quality
Thailand
100% B grade 360-370 ↔
Vietnam
5% broken 325-335 ↔
India
5% broken 365-375 ↔
Pakistan
5% broken 315-325 ↔
Myanmar
5% broken 415-425 ↔
Cambodia
5% broken 425-435 ↔
U.S.
4% broken 530-540 ↔
Uruguay
5% broken 535-545 ↔
Argentina
5% broken 530-540 ↔
Long grain white rice - low quality
Thailand
25% broken 335-345 ↔
Vietnam
25% broken 320-330 ↔
Pakistan
25% broken 290-300 ↔
Cambodia
25% broken 410-420 ↔
India
25% broken 340-350 ↔
U.S.
15% broken 500-510 ↔
Long grain parboiled rice
Thailand
parboiled 100% stxd 355-365 ↔
Pakistan
parboiled 5% broken stxd 415-425 ↔
India
parboiled 5% broken stxd 355-365 ↔
U.S.
parboiled 4% broken 570-580 ↔
Brazil
parboiled 5% broken 545-555 ↔
Uruguay
parboiled 5% broken NQ ↔
Long grain fragrant rice
Thailand
Hommali 92% 820-830 ↓
Vietnam
Jasmine 450-460 ↔
India
basmati 2% broken NQ ↔
Pakistan
basmati 2% broken NQ ↔
Cambodia
Phka Mails 830-840 ↔
Brokens
Thailand
A1 Super 310-320 ↔
Vietnam
100% broken 315-325 ↔
Pakistan
100% broken stxd 275-285 ↔
Cambodia
A1 Super 355-365 ↔
India
100% broken stxd 300-310 ↔
Egypt
medium grain brokens NQ ↔
U.S.
pet food 335-345 ↔
Brazil
half grain NQ ↔
All
prices USD per ton, FOB vessel, oryza.com
Egyptian Cabinet Approves One
Million Ton Rice Exports
Sep
03, 2015
The Egyptian Cabinet has given approval for exporting one million tons of
rice, Bloomberg quoted a statement from the Cabinet.
The cabinet noted that exporters need to sell one ton of medium-grain rice
at about 2,000 Egyptian pounds (around $255) to the General Authority for
Supply Commodities (GASC) for every ton of rice they export, as well as pay an
export tariff of around $280 per ton of rice exported.
Export licenses granted as per the 2014 allowance are understood to be
valid for the current exports.
The decision comes after the government has decided to ban rice exporters
from September 1, 2015 in order to cater to domestic demand.
USDA estimates Egypt to produce 4.5 million tons of milled rice and export
around 250,000 tons in MY 2014-15 (October - September).
Oryza Afternoon Recap - Chicago
Rough Rice Futures Rally as Other Grains Continue to Push into Negative
Territory
Sep
03, 2015
Chicago rough rice futures for Nov delivery settled 10.5 cents per cwt
(about $2 per ton) higher at $12.060 per cwt (about $266 per ton). The other
grains continued to push lower today; Soybeans closed about 0.5% lower at
$8.6950 per bushel; wheat finished about 2.9% lower at $4.6525 per bushel, and
corn finished the day about 1.6% lower at $3.6150 per bushel.
U.S. stocks traded in a narrow
range, attempting to extend a recovery as investors eyed fluctuations in oil
prices and awaited Friday's key jobs report. The Nasdaq composite held mostly
lower in early afternoon trade to wipe out gains for 2015. The S&P 500 and
Dow Jones industrial average dipped in and out of negative territory in
afternoon trade. Earlier, the blue chip index gained as much as 197.69 points
in an attempt to stay out of correction territory. The energy sector struggled
to hold gains after earlier spiking more than 2% on a surge in oil prices. On
Wednesday, the S&P 500 and Nasdaq composite closed out of correction
territory to within 10% of their 52-week highs. The major averages are still on
track for weekly losses of nearly 2%.Asian stocks mostly recovered on Thursday
with the Nikkei up 0.5% helped by a positive finish on Wall Street overnight.
Trading was relatively calm compared to previous sessions as Chinese stock
exchanges closed for the commemoration of the end of World War II.
European stocks closed sharply
higher, with the German DAX ending up 2.7%, following comments from ECB
President Mario Draghi that kept quantitative easing unchanged while raising
the cap on the amount of any one issue it could buy to 33% from 25%.In other
economic news, weekly jobless claims rose to 282,000. The overall U.S. July
trade gap narrowed to $41.86 billion, the smallest in five months, while the
U.S.-China trade deficit in July increased slightly to $31.58 billion from
$31.46 billion in June, Reuters reported. In the afternoon, the Dow Jones
Industrial Average traded up 17 points, or 0.11%, at 16,364. The S&P 500
traded up 2 points, or 0.11%, at 1,951, with consumer staples leading seven
sectors higher and health care the greatest decliner. The Nasdaq traded down 12
points, or 0.27%, at 4,737. Gold is trading about 0.8% lower, crude oil is seen
trading about 1.2% higher, and the U.S. dollar is seen trading about 0.5%
higher about 1:45pm Chicago time.
Wednesday, there were 1,453 contracts traded, up from 1,255 contracts
traded on Tuesday. Open interest – the number of contracts outstanding – on
Wednesday decreased by 867 contracts to 10,096.
Indonesian Rice Production is
Safe and Imports are Last Option, Say Agriculture Ministry Officials
Sep
03, 2015
The Indonesian Agriculture Ministry
Secretary General reiterated that the country's rice production is safe despite
the on-going dry weather conditions due to the El Nino weather pattern.He told
reporters that the Ministry is expecting a 7% y/y increase in paddy rice
production to around 75.2 million tons in 2015 from around 70 million tons in
2014. He however, noted that the output may be below the 75.55 million tons
estimated by the statistics agency in July. He added that some 52,000 hectares
of rice crops have failed as of August due to drought and due to that around
250,000-300,000 tons may be lost this year.
The official noted that the government needs to monitor the impact of
drought on rice prices and inflation. Indonesia's state weather agency is
predicting that the rainy season would be delayed this year and the drought
conditions would peak from October to the beginning of next year due to the El
Nino pattern.
The government has already distributed 20,000 irrigation pumps to farmers,
made more than 1,000 reservoirs and dug 1,000 wells in anticipation of the El
Nino this year, added the Agriculture Minister. He also reiterated that
"imports are the last option".
Earlier this week, the Finance Ministry's Director General for Budgeting
noted that the government has allocated about Rp 3.5 trillion (around $258
million) to support rice production during the drought conditions. Of the
allocated amount, around Rp 1.5 trillion (around $105 million) would be
reportedly used to ramp up the rice reserves at Bulog and the remaining Rp 2
trillion (around $153 million) will be used to help stabilize prices.
Meanwhile, analysts are predicting that Indonesia may have to import about
1.6 million tons of rice this year to maintain stocks and stabilize prices.
Global rice prices are estimated to increase by 10-20% in the next few months
as the El Nino induced drought is expected to lower production prospects in
Asia.
USDA estimates Indonesia to produce around 36.3 million tons of rice, basis
milled (around 57.17 million tons, basis paddy), and import around 1.25 million
tons of rice in MY 2014-15 (October - September).
Oryza Overnight Recap – Chicago
Rough Rice Futures Weighed on Negative Grains Overnight
Sep
03, 2015
Chicago rough rice futures for Nov delivery are currently paused 3 cents
per cwt (about $1 per ton) lower at $11.925 per cwt (about $263 per ton) ahead
of floor trading in Chicago. The other grains are seen trading lower ahead
of early morning action; soybeans are currently seen trading about 0.1% lower,
wheat is listed about 0.9% lower and corn is currently noted about 0.9% lower.
U.S. stock index futures indicated a
higher open on Thursday, building on Wednesday's rally which saw
major averages gain more than 1.5% by the close after a tumultuous week of
trade so far. In Europe, stocks rallied as investors digested the European
Central Bank's decision to keep interest rates unchanged. Regional stocks extended
gains to rise about 2% and U.S. futures briefly more than doubled gains amid
morning data releases and comments from ECB President Mario Draghi that kept
quantitative easing unchanged while raising the cap on the amount of any one
issue it could buy to 33% from 25%.The U.S. dollar spiked, with the euro lower
near $1.11. Weekly jobless claims rose to 282,000. The overall U.S. July trade
gap narrowed to $41.86 billion, while the U.S.-China trade deficit in July
increased slightly to $31.58 billion from $31.46 billion in June, Reuters
reported. The flow of top-tier releases also continues, ahead
of Friday's key jobs report. The August ISM non-manufacturing index
is due at 10:00 a.m. ET. Friday's job numbers is the last monthly
employment report before the U.S. Federal Reserve meets later on in the month,
when an announcement on interest rates is widely anticipated. Gold is currently
trading about 0.9% lower, crude oil is seen trading about 0.3% higher, and the
U.S. dollar is currently trading about 0.6% higher at 8:30am Chicago
time.
Oryza August 2015 Rice Market
Review
Sep
03, 2015
The Oryza White Rice Index (WRI), a weighted average of global white rice
export quotes, ended the month of August at about $388 per ton, down about $9
per ton from a month ago and down about $87 per ton from a year ago. Export
prices and tonnage continue to remain under pressure as market support from
potential El Nino supply cuts remain a distant mirage that may take a year to
materialize.
Thailand
Thailand 5% broken ended the month of August at about $360 per ton, down
about 3% per ton from a month ago and down about 18% per ton from a year ago.
The USDA forecasts Thailand's milled rice production in MY 2015-16 (January -
December 2015) at about 18 million tons (about 27.3 million tons, basis paddy),
down about 7% from about 19.35 million tons (about 29.35 million tons, basic
paddy) in MY 2014-15 due to drought conditions that had impacted planting
operations of the country's main season rice crop. Planting for the 2015-16
main rice crop planting is complete in major growing areas. According to the
Ministry of Agriculture's Disaster Center report, about one million rai (about
160,000 hectares) of main rice crop had been affected by drought, particularly
in the lower northern region and central plains.
Thailand's Office of the Auditor-General (OAG) has found several
irregularities in the implementation of the low-cost rice sales scheme by the
Public Warehouse Organization (PWO), according to local sources. The PWO signed
contracts with six companies to carry out the sales of bagged rice. The OAG
found that only one of the five companies had an experience as a retailer and
some of the others were related to the first one. It also found that a single
person had issued checks on behalf of all the six companies when they purchased
rice from the PWO.
The Thai military government has sold about 426,977 tons of stockpiled rice
to 47 local traders in an open tender raising about 6.3 billion baht (about
$178 million) in the most recent auction, Reuters quoted a Commerce Ministry
official. There have been five auctions this year and nine auctions total since
the military government took over in May 2014. The government sold about 4.4
million of rice raising about 48.6 billion baht (about $1.38 billion) from the
nine auctions. The government of Thailand is also planning to auction about
732,806 tons of stockpiled rice on September 8th 2015, Reuters quoted a
statement from the Commerce Ministry.
China reportedly agreed to buy about one million tons of rice in a
government-to-government (G2G) deal from Thailand. The sale is part of a
December 2014 memorandum of understanding (MoU) (that China signed with
Thailand in December 2014) to buy 2 million tons of rice this year.
Thailand's Supreme Court has rejected the former Prime Minister Yingluck
Shinawatra's plea to allow the trial to be taken up by the Administrative Court
as the case was not within jurisdiction of the Supreme Court's Criminal
Division for Political Office Holders, according to local sources. The Court
also denied her plea to reject additional documented evidence from 23 witnesses
submitted by the prosecutors. The court adjourned the hearing to October 29th
2015.
Vietnam
Vietnam 5% broken rice ended the month of August at about $330 per ton,
down about 3% per ton from month ago and down about 27% per ton from a year
ago. Vietnam exported about 3.492 million tons of rice in January 1 - August
20, 2015, down about 18% from about 4.26 million tons of rice exported in first
eight months of 2014, according to data from the Vietnam Food Association
(VFA). The average rice export price so far in this year stands at about $414
per ton (FOB), down about 4% per ton from about $431 per ton recorded during
same last year. Meanwhile, Vietnam rice exporters have signed contracts to
export about 4.45 million tons of rice as at the end of July 2015, down about
9% from about 4.9 million tons contracted during the same time last year; local
sources quoted an Agriculture Department official as saying. Separately,
Vietnam rice exports to Africa increased about 52% to about 525,896 tons in the
first seven months of 2015 from about 345,984 tons exported during the same
time last year, local sources quoted the Ministry of Industry and Trade.
China, one of the major destinations for Vietnamese rice for the last few
years, has reduced rice imports from Vietnam since the beginning of this year.
Experts say China normally imports higher volume when prices are low, but this
year low prices have failed to attract demand, yet. Looking further out, both
UN's Food and Agriculture Organization (FAO) and USDA are predicting China to
import more rice from Vietnam in the second half of 2015 due to declining rice
prices as well as the impact of drought-inducing El Nino pattern on Chinese
production.
Vietnam has lowered the minimum export price (MEP) of its lower quality
(25% broken) rice exports by about 3% to about $340 per ton from about $350 per
ton in order to boost exports. The MEP was effective from August 13, 2015.
Cambodia
Persisting dry conditions have affected rice seedlings in about 185,451
hectares of paddy fields in Cambodia. According to the report sent to the Prime
Minister, about 9,240 hectares of paddy fields have been completely damaged.
USDA estimates Cambodia's average yield per hectare at 2.43 tons. Based on
these estimates, Cambodia may have about 450,000 tons of paddy affected by
flooding this year. Cambodia produced about 9 million tons of paddy rice in
2014, according to the local sources.
Separately, a rice industry specialist has advised Cambodian rice exporters
to focus on diversifying markets and focus on increasing fragrant rice exports,
according to Khmer Times. Cambodia has exported about 312,317 tons of milled
rice in the first seven months of 2015, up about 53% from about 204,128 tons
exported during the same period last year, according to data from the Secretariat
of One Window Service for Rice Export Formality.
Cambodia produces multiple varieties of jasmine rice varieties, including
Phka Romdeng, Phka Romeat, Phka Rumduol but lacks a single brand name that can
differentiate its jasmine rice in the international market. The government and
the Cambodian Rice Federation (CRF) are working separately to come up with a
brand name that could distinguish Cambodian jasmine rice from the Thai jasmine
rice.
Myanmar
FAO expects the ongoing floods in Myanmar to impact the volume of rice
exports in 2015. FAO had earlier estimated Myanmar to export about 810,000 tons
of rice in 2015. But in the light of floods affecting vast areas of paddy
fields, the UN agency says Myanmar's rice exports may be below the earlier
estimated figure. Severe floods in the northern and western Myanmar are said to
have damaged about 560,000 hectares of rice fields. Meanwhile, the USDA
forecasts Myanmar 2015-16 rice exports to decline by about 250,000 tons as the
government would take measures to replenish stocks in the areas affected by
recent floods.
Separately, the Myanmar Rice Federation (MRF) and the government have
jointly decided to ban rice exports until September 15th, when the new monsoon
rice crop is expected to reach the market. However, some local sources are
expecting that Myanmar may not resume rice exports until November this year.
Philippines
The Philippine Statistics Agency (PSA) has estimated the country's 2015
paddy output at about 18.86 million tons, about 6% below the targeted 20.08
million tons and slightly down from last year's output of 18.97 million tons.
Meanwhile, the government of the Philippines will maintain the 20 million tons
paddy output target this year despite concerns of an El Nino weather pattern,
Bloomberg quoted the Agriculture Department Assistant Secretary. He said the
Agriculture Department is seeking 940 million pesos ($20.3 million) in
additional budget to fund programs that will mitigate the impact of El Nino.
The Philippines is aiming to produce about 20.09 million tons of paddy rice in
2016, up about 6.5% from an estimated 18.86 million tons this year, according
to Reuters.
Separately, the Philippine Center for Post-Harvest Development and
Mechanization (PhilMech) and the Department of Science and Technology (DOST)
have jointly developed a technology that helps in enhancing brown rice
production in the country.
The Philippines Food Secretary has declared that there is a need to import
more rice, above the already imported 750,000 tons from Vietnam and Thailand,
in 2015 due to the impact of El Nino on rice crop, according to Bloomberg. He
however noted that the quantum of imports is still not clear. He stated that
the government is assessing the damage to rice crops due to drought and will
decide on the volume of imports soon.
The National Food Authority (NFA) has already imported 750,000 tons of rice
(200,000 tons from Thailand and 550,000 tons from Vietnam) under
government-to-government deals to ensure adequate stocks in the lean season
(June – September). It has also allowed the private traders to import 805,200
tons of rice under the WTO minimum access volume (MAV) rule. The NFA is still
authorized to import another 250,000 tons in case of adverse weather
conditions.
Total rice stocks in the Philippines as of July 1, 2015 stood at about 2.57
million tons, down about 15% from about 3.02 million tons recorded in June
2015, and up about 27% from about 2.03 million tons recorded during the same
period last year.
China
Output from China's first harvest period (early rice) has declined about 1%
to about 33.69 million tons from about 34.01 million tons produced in 2014,
local sources quoted the National Bureau of Statistics (NBS).
India
India 5% broken rice ended the month of August at about $370 per ton, down
about 5% per ton from a month ago, and down about 16% per ton from a year ago.
The government of India, in its fourth advance estimates for major crops, has
estimated India's rice production, milled basis, for 2014-15 crop year (July
2014 - June 2015) at about 104.8 million tons, up about 2.26 million tons or
about 2.2% from its earlier estimates of about 102.54 million tons, according
to a statement from the agriculture Ministry. However, the production is
estimated to be down about 2% from about 106.65 million tons in 2013-14.
Separately, experts have noted that delayed planting and unevenly
distributed rains across the country are likely to hamper the 2015-16 rice
production though the on-going kharif rice acreage is ahead of last year as on
August 21, 2015, according to local sources. Meanwhile, total rice planted area
to India's 2015-16 Kharif (main) rice crop (June - December) stood at about
34.59 million hectares as of August 28, 2015, slightly up from about 34.55
million hectares planted during the same time last year, according to a press
release by the Agriculture Ministry.
Analysts are expecting basmati rice prices in India to decline in the
coming months as supplies from the on-going kharif crop would reach the market
while there is still no confirmation over the resumption of rice imports from
Iran, according to the Hindu Business Line. Basmati rice producers in India had
suffered huge losses in 2014-15 (April - March) due to price falls and decline
in demand after Iran imposed a temporary ban in November 2014 citing adequate
stocks.
Average monthly wholesale rice prices in India increased to about
Rs.2,663.31 per quintal (about $403 per ton) in August 2015, slightly up from
about Rs.2,650.04 per quintal (about $416 per ton) in July 2015, and down about
18% from their year-ago levels of about Rs.3,254 per quintal (about $542 per
ton).
India’s rice stocks in the central pool as of August 1, 2015 stood at about
18.6 million tons (including a milled equivalent of about 5.021 million tons of
paddy), down about 24% from about 24.56 million tons recorded during the same
period last year, according to data from the Food Corporation of India (FCI).
Pakistan
Pakistan 5% broken rice ended the month of August at about $325 per ton,
down about 7% per ton from a month ago and down about 26% per ton from a year
ago. Pakistan exported about 155,570 tons of rice (including basmati and
non-basmati) in the first month of FY 2015-16 (July - June), down about 14%
from about 181,398 tons exported during the same period in FY 2014-15,
according to provisional data from the Pakistan Bureau of Statistics (PBS). In
terms of value, Pakistan's earned about $91 million in July 2015, down about
27% from about $125 million last year. Meanwhile, Pakistan exported about 3.93
million tons of rice in FY 2014-15 (July - June), up about 6% from about 3.72
million tons in 2013-14, according to the National Space Agency of Pakistan
(SUPARCO). However, exports declined by about 6% in terms of earnings due to a
decline in global prices of rice.
Separately, the Federal Committee on Agriculture (FCA) of Pakistan has
reportedly fixed the 2015- 16 (July - June) milled rice production target at
about 6.902 million tons (about 10.21 million tons, basis paddy) from about
2.836 million hectares. It is targeting a yield of about 2.434 tons per hectare
in 2015-16.
The Agriculture Policy Institute (API) under the Ministry of National Food
Security & Research of Pakistan suggested the government to intervene in
the market, based on a survey of cost of production and import/export parity
prices. It suggested that the government could consider a paddy support price
of about Rs.1, 800 per 40 kilograms (about $435 per ton) for basmati and about
Rs.850 per 40 kilograms (about $205) for non-basmati rice.
Iran has agreed to lift the ban on rice imports from Pakistan in the
aftermath of removal of international sanctions, according to local sources.
The imports are to be reinstated from October 2015.
Bangladesh
The government of Bangladesh has extended the time limit for aromatic rice
exports until December 31, 2015 in order to enhance the share of the country's
brands in foreign markets, according to local sources. However, some exporters
expressed concern that the government should have extended the time limit until
June 30, 2016 to strengthen exports.
Separately, Bangladesh rice farmers have been advised to preserve as well
as increase production of indigenous rice varieties such as 'Parija' through
modern technologies, according to local sources.
Indonesia
FAO estimates Indonesia 2015-16 (April - March) rice imports to decline
about 10% y/y to about 900,000 tons due to a favorable production outlook for
the 2015 rice production as well as self-sufficiency policies advocated by the
government. The agency estimates Indonesia's 2015 aggregate paddy rice
production at about 75.6 million tons, up about 7% from last year.
Meanwhile, on-going drought conditions are expected to reduce Indonesia's
2015 paddy rice production by about 800,000 tons, down from an estimated 75.5
million tons, according to Bloomberg. The country's statistics agency is
estimating 2015 paddy rice output to reach about 75.55 million tons (about 47.6
million tons, basis milled) in 2015. The government is keen on achieving
self-sufficiency in rice production and stop imports over the next few years.
The government of Indonesia has allocated about Rp 3.5 trillion (about $258
million) to support rice production during the drought conditions, local
sources quoted the Finance Ministry's Director General for Budgeting.
Separately, Indonesia's Public Works and Public Housing Minister has assured
adequate water supplies for the 2015-16 rice planting season, which will last
from September to January, according to local sources.
The government of Indonesia has fixed the 2016 paddy rice target at about
76.23 million tons (about 48 million tons, basis milled), Bloomberg quoted a
statement from the Finance Ministry. The Indonesian government is also planning
to expand rice fields by about 60,000 hectares in 2016. It is also reportedly
planning to improve irrigation facilities in about 500,000 hectares of farm
lands, including rice.
South & Central America
Brazil 5% broken rice ended the month of August at about $500 per ton, unchanged
from a month ago and down about 18% per ton from a year ago. Brazil’s National
Grains Supply Company (Conab) has forecasted the country's 2014-15 paddy rice
production at about 12.432 million tons (about 8.45 million tons, basis
milled), up about 2.6% from about 12.121 million tons (about 8.24 million tons,
basis milled) in 2013-14, and slightly down from its July forecast of about
12.499 million tons. Average rice yield in Brazil in 2014-15 is projected at
about 5.45 tons per hectare, up about 6.6% from about 5.11 tons per hectare
recorded in the previous year, and slightly up from its July forecast of about
5.43 tons per hectare.
The government of Guyana is planning to implement a rice-marketing plan, which aims at improving
productivity, reducing production costs, enhancing operational efficiency in
rice mills and development of value-added products for export, local sources
quoted the Agriculture Minister. The Minister said that rice is an import
staple in the country contributing to about 61% of agricultural GDP and
supporting at least 10% of the population as well as the highest foreign
exchange earning product (accounting for about 21.3% of export earnings) in
Guyana. The country's per capita rice consumption is estimated at about 50
kilograms, said the Minister.
U.S.
U.S. 4% broken rice ended the month of August at about $490 per ton, up
about 3% per ton from a month ago and down about 9% per ton from a year
ago. The USDA estimates U.S. 2015-16 all rice supplies at about 12.63 million
tons, unchanged from its last month's forecast, despite expected lower
production. It expects higher imports and stocks would compensate for lower
production. The agency estimates U.S. all rice production (milled basis) at
about 9.3 million tons, down from last month's estimate of 9.39 million tons
due to a slight reduction in yield. It estimates 2015-16 all rice use at about
10.7 million tons, down from last month's estimates of about 10.89 million tons
due to an estimated decline in domestic & residual use since exports are
estimated to be lower from last month. The USDA estimates 2015-16 all
rice exports at about 4.85 million tons, down from last month's estimates of
about 4.99 million tons, and the decline is expected in milled rice exports.
Rice output in the U.S. state of Louisiana is expected to be below last two
years' output, according to the Director of the LSU AgCenter Rice Research
Station. The official says that heavy rains between March and May as well as
cloudy skies thereafter are main reasons for low yields. Louisiana is the third
largest rice producing state in the U.S. after Arkansas and California and
accounts for about 15% of the total U.S. rice production.
Africa
The government of Mozambique is planning to introduce surcharge on imports of rice beans, meat and eggs
in order to encourage domestic production, local sources quoted the Minister of
Agriculture and Food Security. Recently, quoted the National Director of
Agriculture and Forestry noted that Mozambique has about 900,000 hectares of
land for potential rice production but only 310,000 is being used currently. He
added that this underutilization of production capacity in the country is
leading to rice deficit and forcing the government to import rice.
The Head of the National Office of Rice Growing Department in Ivory Coast has urged the government to develop
irrigation facilities in the country to help boost rice production in the
country, China Post quoted local sources. Currently, 85% of the Ivorian rice
relies on rain and only one dam caters to rice fields in the northern region,
he says. Ivory Coast produces only 60% of rice needed for annual domestic
consumption of about 2.3 million tons and imports the rest.
The Federal Government of Nigeria is planning to review the rice import policy in order to increase
productivity, raise incomes of farmers as well as promote exports, the
Permanent Secretary of the Federal Ministry of Agriculture and Rural
Development (FMARD) was quoted. The Nigerian government has targeted to achieve
self-sufficiency in rice production and end imports by 2015.
Europe
The European Union's (EU) imported about 1.143 million tons of rice in the
first eleven months of the crop year 2014-15 (September - August), up about 13%
from about 1.014 million tons last year. The European Commission (EC) says the
EU rice imports have reached record highs after six years when they reached
about 1.066 million tons in 2007-08. Meanwhile, the EU rice imports from the
Least Developed Countries (LDCs) of Asia such as Cambodia and Myanmar under the
Everything But Arms (EBA) Agreement have reached about 314,265 tons in the
first eleven months of the crop year 2014-15 (September 2014 - August 2015), up
about 12% from about 281,000 tons imported during the same period last year,
according to data from the EC.
Meanwhile, the EU and the Vietnam have signed a bilateral free trade
agreement (FTA) after two-and-half years of intense talks, according to local
sources. Under the agreement, the EU can import 80,000 tons annually from
Vietnam at zero percent import duty.
Other Markets
Planting for Nepal 2015-16 rice crop is lagging by 3%
over last year due to unfavorable monsoon, local sources quoted the Ministry of
Agricultural Development (MoAD). According to data from the MoAD, rice planting
area stood at about 1.487 million hectares as of August 24, 2015, down 3% from
about 1.533 million hectares planted last year. The current acreage accounts
for about 87% of the country's total acreage. Paddy contributes to 20% to the
total agricultural production in Nepal and about 7% of the country's GDP. The
Agriculture Ministry estimates Paddy production in 2014-15 to decline about
5.71% to about 4.78 million tons from about 5.04 million tons in 2013-14 due to
a late monsoon and untimely rainfall.
Meanwhile, Production shortfalls and
expensive imports have been pushing up domestic rice prices in the country,
according to local sources. The price of most commonly used rice variety Jira
Masino have increased to about Rs.1,450-1,850 (about $559 - $713) per 25
kilogram bag from about Rs.1,350-1,750 (about $520 - $674) per 25 kilogram bag,
according to local sources. They say traders of branded rice have also hiked
prices in the recent past. Nepal has imported rice worth Rs.24.75 billion
(about $231 million) in the fiscal year 2014-15 (August - July), up about 43%
from about Rs.17.26 billion (about $161 million) during FY 2013-14, local
sources quoted the Nepal Rastra Bank (NRB).
The government of Iran is expecting 2015-16 (April - March) rice production, basis milled, at
about 2 million tons, Iran English Radio quoted the Secretary of Iran's
Government Rice Association (saying on Press TV). The main rice crop season
starts in April and ends in September.
The Kuwait Fund for Arab Economic
Development (KFAED) has signed an agreement with the government of Chad to
provide about 4 million Kuwaiti Dinars (about $13.6 million) to help boost rice
production in Chad, according to local sources.
The government of Egypt has planned to ban rice exports from September 1, 2015 in order to fulfil
domestic demand; however, on September 3rd it was reported that the
government will allow the export of one million tons. While Egypt is expected
to produce about 2.7 million tons of white rice in 2015-16, its annual
consumption demand is estimated at about 3.6 million tons. The Ministry reportedly
said in a statement that the demand gap would be fulfilled from the existing
stocks.
Research and Scientific Development:
The International Rice Research Institute (IRRI) and the Africa Rice Center
(AfriceRice) have jointly released two cold-tolerant rice varieties in
Madagascar under the IRRI's Stress-tolerant Rice for Africa and South Asia
(STRASA) program.
Researchers from the Thailand Development Research (TDRI) have recommended
to the government to set up a 'Rice Market Development Institute' to enhance
rice related research.
Researchers from Japan's National Food Research Institute (NFRI) have
developed a jelly like substance called "rice gel" that can be used
in the processing food industry.
Chinese researchers have found that by modifying a gene called BG1 (Big
Grain 1) in rice plants, the length and weight of the rice grains can be
significantly increased.
The researchers of the Temperate Rice Research Consortium (TRRC) in Italy
are organizing a meeting called "Perspectives and Solutions for
Competitive Rice Growing" in the Italian Rice Research Center, in Castello
d'Agogna (Pavia), on September 10, 2015.
Researchers at the UK's John Innes Centre have found means to increase rice
plants' resistance to pathogens by understanding how rice plants detect
pathogens.
August Tenders:
The Mauritius state purchasing agency issued an international tender to
purchase up to 6,000 tons of long-grain white rice from optional origins.
The government of Liberia invited tenders from eligible and qualified
Liberian owned businesses for the supply of Dry Ration (rice) during 2015-16,
according to a statement by the Ministry of National Defense (MoD).
Iraq issued an international tender to purchase about 30,000 tons of rice
from the U.S., Uruguay, Argentina, Brazil and India.
Oryza U.S. Rough Rice Recap -
New Sale to Venezuela Helps Support Prices
Sep
03, 2015
The U.S. cash market was firmer today rallying on the news of yet another
sale of long grain paddy to Venezuela and anticipation of more milled rice
business to Iraq.
Analyst note that without the recent increase in export demand prices would
have likely remained depressed however others warn that these higher prices are
beginning to turn off some foreign buyers.
In the meantime, the USDA reported that cumulative net export sales for the
week that ended on August 27th, totaled 66,000 tons, an increase of
97% from the previous week.
Increases were reported for the following destinations including: 29,500
tons to Venezuela, 19,600 tons to Mexico, 7,200 tons to unknown destinations,
and 3,000 tons to Panama, while decreases of 1,300 tons, 200 tons, and 100 tons
were reported for Guatemala, Costa Rica, and Russia respectively.
U.S. rice exporters shipped 156,400 tons, and increase of 74% from the
previous week, with the primary destinations including: 59,500 tons to
Venezuela, 31,500 tons to Iraq, 24,800 tons to Mexico, 12,000 tons to Japan,
and 6,800 tons to Haiti.
Real Rice Ban Never Existed in
Iran, Says Indian Grains Analyst
Sep
03, 2015
Though Iran has been claiming that rice import from India was banned in
2014 due to their own surplus availability owing to local supplies or excess
imports in 2013, they have created a system where by only select private
parties have been supported with import licencing. This has existed for the
last 15-16 months. Call it canalised import through privatisation, though
Government Trading Corporation of Iran (GTC) too remains another conduit of
import whenever required.
Thus it is very difficult to conclude when the ban is imposed or lifted.
Food articles were never sanctioned under US/UN orders. In fact REAL ban never
existed in Iran.
The same may be true for Pakistan as well and small containerised supplies
of Pakistani rice may be going to Iran under such arrangements during sanctions
as well. India had an advantage of rupee payment from 2011 till today—which
will cease soon.
However Indian Pusa 1121 PB will continue to get overriding priority by
Iranian buyers over Pakistan origin, so long as Indian prices are competitive
and these will be.
Pakistan is ideologically a nation with Sunni Muslim majority, while Iran
is the leader of world’s Shia movement. Politically too, Pakistan will not be
favoured in the trade on these grounds.
Views by Mr.Tejinder Narang
USDA Post Estimates Myanmar 2015
Rice Exports to Decline 5% y/y to 1.6 Million Tons
Sep
03, 2015
USDA Post estimates Myanmar 2015 rice exports to decline to around 1.6
million tons from an estimated 1.688 million tons in 2014 based on reports from
the trade sources.
The decline is attributed to the imposition of a temporary ban on exports
in the first week of August after floods damaged about 250,000 hectares of rice
fields in the northern and western regions of the country leading to a surge in
the domestic rice prices.
The Post estimates that around 250,000-300,000 tons of exports have been
impacted due to the imposition of the ban.
The government has been supporting farmers in the flood-affected area to
replant their crops. If rice cannot be replanted, the government is planning to
help farmers plant other crops such as beans or pulses. The Post estimates
Myanmar's MY 2015-16 (January - December 2016) milled rice production to
decline about 3% to around 12.2 million tons from an estimated 12.6 million
tons in MY 2014-15.
