26th January 2016 Daily Exclusive ORYZA Rice E-Newsletter by Riceplus Magazine

Cambodia Prime Minister Calls for More Investment in Rice Storage, Drying Facilities

Jan 25, 2016

The Cambodian Prime Minister has highlighted the need for more investment in rice storage an drying facilities to facilitate more exports, according to Xinhua.

Speaking at the opening ceremony of the 5th Cambodia Rice Forum in Phnom Penh, the Prime Minister noted that lack of adequate rice storage facilities and drying machines is barring traders and exporters from buying a large amount of paddy rice from farmers. To address this issue and boost exports, more investment is needed, he said.

"The government of Cambodia has been negotiating with China for loans to construct storage facilities and drying machines across the country," he was quoted. He expressed confidence that China being the top importer of Cambodian rice would certainly support for the development of the Cambodian rice sector.

About 700 people comprising of policy makers, rice millers, exporters, farmer-representatives, and transport company representatives reportedly attended the rice forum.

Recently, the Cambodia Rice Federation (CRF) also noted that about $550 million is needed for the development of the country's rice production and supply chain to achieve the one million ton export target.

Cambodia's rice exports increased significantly in 2015 though the one million ton target could not be reached. Cambodia exported around 538,396 tons of milled rice in 2015 up about 39% from around 387,061 tons exported during the same period last year.

Government of Guyana Advises Farmers to Delay 2016 Rice Sowing Due to Dry Conditions

Jan 25, 2016

The government of Guyana has advised farmers to delay rice planting activities for the 2016 crop due to the beginning of the El Niño-induced dry season, according to local sources.

However, some farmers are understood to have planted about 90% of their fields, according to the Agriculture Minister. He advised farmers who have not started planting to delay their planting operations. “If you haven’t planted already, don’t plant now because you wouldn’t get enough water, and we are trying to have enough water to save the crop that is already planted,” he said. The Minister also advised farmers who have already planted not to plant in the remaining area.

The Ministry of Agriculture is reportedly working with other agencies such as the Civil Defence Commission (CDC), and the National Drainage and Irrigation Authority (NDIA) to monitor the areas hardest hit by the current dry weather conditions.

Guyana's 2015 paddy rice production increased about 8% to around 1.06 million tons (around 687,784 tons, basis milled) from around 977,289 tons (around 635,238 tons, basis milled) in 2014, according to data from the Guyana Rice Development Board (GRDB).

New IRRI Facility to Study Climate Change Impact on Rice Production

A new $10 million state-of-the art facility for studying climate change effects on rice plant growth has been opened on January 21, 2016, on the campus of the International Rice Research Institute (IRRI) as part of the IRRI's efforts to achieve food and nutrition across the globe, according to an IRRI press release.

The facility is named after Lloyd T. Evans (1927-2015), a world-renowned Australian plant physiologist who also served as a member of the IRRI board of trustees (1984-89), according to the press release.

The Lloyd T.Evans Plant Growth Facility (PGF) is funded by the Australian government, through the Australian Centre for International Agricultural Research (ACIAR). The PGF has eight controlled environment glasshouses and large sets of plant and seed laboratories, which can simulate various weather conditions such as drought, flood and heat. They will also allow researchers to study the effects of temperature, humidity, light intensity, atmospheric gases and water management systems on rice plant growth.

“Fundamentally, (the facility will) enable scientists to simulate the effects of climate change,” said the IRRI Deputy Director General for Communication and Partnerships. “We will know exactly how the plants react to the effects of climate change and ensure how [they] will continue to grow and be productive [under these conditions],” he said.

Indonesia Needs 1.2 Million Tons of Rice Stocks by March 2016 to Ensure Adequate Supplies, Says Minister

Jan 25, 2016

The government of Indonesia needs about 1.2 million tons of rice to maintain adequate stocks by the end of March 2016, Antara News Agency quoted the National Development Planning Minister.

Speaking in a meeting at the Vice-Presidential Office, the Minister noted that stocks are necessary to ensure sufficient supplies in the country. He also noted that the buffer stock is planned in anticipation of rice shortages due to a delay in the planting operations following extended dry conditions. 

"At the meeting, we reported everything to the vice president, including this development and the policy we have adopted regarding food supplies," he said.

The Coordinating Minister of Economic Affairs, the State Enterprises Minister and the Agriculture Minister were also present at the meeting.

Meanwhile, the government of Indonesia is planning to lower 2016 paddy rice output target to 75.13 million tons from last year's 76.23 million tons, according to the Director General of Food Crops at Agriculture Ministry. The government will shortly sen a letter to National Planning Ministry on the issue.

Global Rice Quotes

January 25th, 2016

Long grain white rice - high quality

Thailand 100% B grade          370-380           ↔

Vietnam 5% broken    345-355           ↔

India 5% broken         355-365           ↔

Pakistan 5% broken    340-350           ↑

Myanmar 5% broken   415-425           ↔

Cambodia 5% broken             425-435           ↔

U.S. 4% broken           465-475           ↔

Uruguay 5% broken    475-485           ↔

Argentina 5% broken 470-480           ↔

Long grain white rice - low quality

Thailand 25% broken 350-360           ↑

Vietnam 25% broken 340-350           ↔

Pakistan 25% broken 305-315           ↔

Cambodia 25% broken           405-415           ↔

India 25% broken       325-335           ↔

U.S. 15% broken         445-455           ↔

Long grain parboiled rice

Thailand parboiled 100% stxd            370-380           ↑

Pakistan parboiled 5% broken stxd    405-415           ↔

India parboiled 5% broken stxd         345-355           ↔

U.S. parboiled 4% broken       500-510           ↔

Brazil parboiled 5% broken    520-530           ↔

Uruguay parboiled 5% broken            NQ      ↔

Long grain fragrant rice

Thailand Hommali 92%          680-690           ↔

Vietnam Jasmine         425-435           ↔

India basmati 2% broken        NQ      ↔

Pakistan basmati 2% broken   NQ      ↔

Cambodia Phka Mails             750-760           ↔

Brokens

Thailand A1 Super      320-330           ↔

Vietnam 100% broken            320-330           ↓

Pakistan 100% broken stxd    290-300           ↔

Cambodia A1 Super   345-355           ↔

India 100% broken stxd         260-270           ↔

Egypt medium grain brokens NQ      ↔

U.S. pet food 280-290           ↔

Brazil half grain          NQ      ↔

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

Pakistan Rice Exporters Seek Appropriate Payment Mechanisms to Facilitate Exports to Iran

Jan 25, 2016

The Chairman of the Rice Exporters Association of Pakistan (REAP) has called for appropriate currency transfer arrangements between the two countries to facilitate exports to Iran, according to the Nation.

The REAP Chairman appreciated the lifting of sanctions on Iran, as it would provide an opportunity for Pakistan to enhance trade with the Middle East nation. He, however, noted that the restart of rice export to Iran will remain ineffective until a detailed payment mechanism is evolved.

He, therefore, urged the banking sectors of the two nations to establish active linkages as early as possible to help traders to channel their payments. “In the past few years, lack of recognised and trustable payment mechanism through banks proved to be the single largest factor hindering bilateral trade,” he said. The official also reiterated that Pakistan was once the largest rice exporter to Iran before the imposition of sanctions. But now, India has taken the position.

The official also noted that a free trade agreement (FTA) between the two governments would provide a solution to most of the trading problems. He stated that currently Iran's tariffs on agricultural products are very unpredictable as they change depending on the time of harvest. However, the conclusion of an FTA can bring more predictability and clarity on such tariffs, he added.

Oryza CBOT Rough Rice Futures Recap - Chicago Rough Rice Futures Close Slightly Higher as Grains Begin the Week on a Positive Note

Jan 26, 2016

Chicago rough rice futures for Mar delivery settled 5 cents per cwt (about $1 per ton) higher at $11.010 per cwt (about $243 per ton). The other grains finished the day with mixed results; Soybeans closed about 0.5% higher at $8.8050 per bushel; wheat finished about 1.3% higher at $4.8150 per bushel, and corn finished the day about 0.1% lower at $3.6975 per bushel.

U.S. stocks traded lower Monday as a renewed decline in oil prices weighed amid some major earnings reports, ahead of the Federal Reserve meeting later in the week. Despite the sharp decline in oil, the major U.S. averages held only slightly lower in early afternoon trade. More than 100 S&P 500 firms are due to report this week. Major tech firms set to announce quarterly results in the next few days include Apple, Facebook, Amazon.com and Microsoft. No major economic data was expected Monday. The Dallas Fed January manufacturing production index came in at negative 10.2 versus 12.7 in December.

The business activity index was minus 34.6 versus minus 21.6 the previous month. Consumer confidence is due Tuesday, ahead of consumer sentiment and fourth-quarter GDP on Friday. European stocks closed lower Monday declines in oil prices weighed. Asian stocks ended higher, with the Hang Seng up almost 1.4% and the Nikkei 225 up nearly 1%. The Shanghai composite closed more than half a percent higher. In midday trade, the Dow Jones industrial average declined 77 points, or 0.49%, to 16,015. The S&P 500 traded down 12 points, or 0.67%, to 1,894, with energy leading eight sectors lower and telecommunications and health care the only gainers. The Nasdaq composite fell 27 points, or 0.58%, to 4,564. Gold is seen trading about 0.9% higher, crude oil is seen trading about 4.7% lower, and the U.S. dollar is seen trading about 0.2% lower at about  1:00pm Chicago time.

Friday, there were 423 contracts traded, down from 524 contracts traded on Thursday. Open interest – the number of contracts outstanding – on Friday decreased by 101 contracts to 13,297. 

Philippines 2015 Paddy Rice Production Declines 4.31% to 18.15 Million Tons, Says PSA

Jan 25, 2016

The Philippine Statistics Authority (PSA) estimates the Philippines 2015 paddy rice production at around 18.15 million tons, down about 4.31% from around 18.97 million tons in 2014.

The PSA estimates the harvest area at around 4.656 million hectares, down about 1.76% from around 4.74 million hectares in 2014. It estimates the 2015 yield at around 3.9 tons per hectare compared to around 4 tons per hectare in 2014.

All regions other than Bicol, Western Visayas, Zamboanga Peninsula and Northern Mindanao recorded significant reductions in production, says the PSA.

The agency estimates the 2015 first half (January - June) paddy production at around 8.32 million tons from around 2.066 million hectares of land and the second half (July - December) paddy production at around 9.83 million tons from around 2.59 million hectares.

Based on the standing crop situation, the PSA estimates the Philippines 2016 first half paddy rice production at around 8.2 million tons from around 2.02 million hectares. The agency estimates the January - March 2016 paddy production at around 4.15 million tons, down about 4.98% from around 4.37 million tons in 2015. It estimates the harvest area and yield to decline by about 4.25% y/y to around 1.1 million hectares and 0.76% to around 3.77 tons per hectare respectively. The agency estimates the April - June 2016 paddy production harvest area and yield are foreseen to increase by 2.37%, 1.03% and 1.33% y/y respectively to around 4.05 million tons, 922,967 hectares and 4.39 tons per hectare.

Thailand, Pakistan Rice Sellers Increase Some of Their Quotes; Vietnam Rice Sellers Lower Some of Their Quotes

Jan 25, 2016

Thailand Rice sellers increased their quotes for 5% broken rice, 25% broken rice and parboiled rice by about $5 per ton each to about $360-$370 per ton, $350-$360 per ton and $370-$380 per ton respectively. Vietnam rice sellers lowered  their quotes for 100% broken rice by about $10 per ton to about $320-$330 per ton. Pakistan rice sellers increased their quotes for 5% broken rice by about $5 per ton to about $340-$350 per ton. India rice sellers kept their quotes unchanged today.                                

5% Broken Rice

Thailand 5% rice is indicated at around $360 - $370 per ton, about $15 per ton premium on Vietnam 5% rice shown at around $345 - $355 per ton. India 5% rice is indicated at around $355 - $365 per ton, about $15 per ton premium on Pakistan 5% rice shown at around $340 - $350 per ton.

25% Broken Rice

Thailand 25% rice is indicated at around $350 - $360 per ton, about $10 per ton premium o Vietnam 25% rice shown at around $340- $350 per ton. India 25% rice is indicated at around $325 - $335 per ton, about $20 per ton premium on Pakistan 25% rice shown at around $305 - $315 per ton.

Parboiled Rice           

Thailand parboiled rice is indicated at around $370 - $380 per ton. India parboiled rice is indicated at around $345 - $355 per ton, about $60 per ton discount to Pakistan parboiled rice last shown at around $405 - $415 per ton.

100% Broken Rice

Thailand broken rice, A1 Super is indicated at around $320 - $330 per ton, on par with Vietnam 100% broken rice shown at around $320 - $330 per ton. India's 100% broken rice is shown at around $260 - $270 per ton, about $30 per ton discount to Pakistan broken sortexed rice shown at around $290 - $300 per ton.

USDA Post Forecasts Vietnam 2016 Rice Exports at 6 Million Tons, Down 8% from Previous Year

Jan 25, 2016

USDA Post forecasts Vietnam's 2016 rice exports at around 6 million tons, down about 8% from an estimated 6.5 million tons last year and down from USDA's official estimate of around 7.1 million tons due to an expected low carry-over stocks from MY 2014-15 (January-December 2015).

The Post estimates MY 2014-15 rice stocks to be very low due to unexpected increase in demand from Indonesia and the Philippines. It is expecting rice stock in MY 2015-16 also to be almost similar to MY 2014-15 levels, which will prevent Vietnam exporting large amounts during the year. The Post estimates 2015-16 rice stocks to reach about 693,000 tons, up from USDA's official estimates of around 673,000 tons and up from last year's 633,000 tons.

The Post estimates Vietnam's 2015-16 (January-December 2016) paddy rice production to reach around 45.056 million tons (around 28.38 million tons, basis milled), down from an estimated 45.175 million tons (around 28.46 million tons) last year and down from USDA's official estimate of around 45.12 million tons (around 28.43 million tons, basis milled) due to the larger planted and harvested area of winter crop, due to low level flooding  in the Mekong River Delta (MRD).

Post estimates that the country needs about 100,000 - 500,000 tons of additional rice for fulfilling the needs of the food processing and animal feed industries. It forecasts MY 2015-16 rice consumption needs at around 22.6 million tons, up from last year's estimates 22.5 million tons and up from USDA's official estimates of around 22 million tons.

Vietnam Exports About 108,959 Tons Rice in January 1-20, 2016, Down 50% from Previous Year

Jan 25, 2016

Vietnam exported about 108,959 million tons of rice in January 1-20, 2016, down about 50% from about 671,174 tons rice exported in January 2015, and down about 86% from about 760,993 tons rice exported in December 2015, according to data from the Vietnam Food Association (VFA). The . The average export price so far in January stands at about $365 per ton, down about 19% per ton from a year ago and down about 10% per ton from a month ago.

In 2015, Vietnam exported about up about 6.568 million tons, up about 4% from about 6.33 million tons of rice exported in 2014.

U.S. Finalizes Rice Trade Agreement with China, Says USA Rice Federation

Jan 25, 2016

The U.S. and China have agreed on a protocol, which reportedly establishes the phytosanitary or pest control rules necessary to allow U.S. rice into China, the Wall Street Journal quoted the USA Rice Federation.

The USA Rice Federation reportedly noted that the USDA confirmed the finalizing of the deal last week. It also noted that the deal came after the two nations settled on the requisite steps to be taken by the U.S. industry to control insects and on labelling requirements for exports.

A USA Rice spokesman, citing USDA officials, said" "exports to China could be allowed by early spring, barring any disruptions. U.S. mills and storage facilities will need to be inspected by both the USDA and Chinese regulators, and China must issue a decree authorizing the imports."

“The challenge now is to move from agreement to shipments,” added the Chief Executive of the USA Rice Federation.

China, world's largest rice consumer, has not given access to the U.S. rice for a long time and a rice deal between the two nations has been under negotiation for nearly a decade. The USDA Animal and Plant Health Inspection Service (APHIS) has been reportedly working closely with the U.S. rice industry and China’s Administration of Quality Supervision, Inspection and Quarantine to finalize an agreement on the final set of protocols for exporting U.S. milled rice to China.