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USDA Rice Outlook


16 October 2012

USDA Rice Outlook - October 2012USDA Rice Outlook - October 2012


USDA Rice Outlook

U.S. 2012/13 Crop Forecast Raised to 198.9 Million Cwt

The 2012/13 U.S. rice crop forecast was raised 2.5 million cwt to 198.9 million cwt based on a higher yield. At 7,428 pounds per acre, the average yield is the highest on record. Average yields are estimated higher than year-earlier in all reported States, with record yields projected for Arkansas, Louisiana, and Texas. Progress of the 2012/13 U.S. crop remains well ahead of normal in much of the South.

The total U.S. domestic and residual use forecast for 2012/13 was raised 1.0 million cwt to 127.0 million cwt based on the larger crop. These revisions resulted in a 1.6-million cwt increase in the 2012/13 ending stocks forecast to 32.4 million cwt. The 2012/13 season-average farm price (SAFP) for U.S. long-grain rice was raised 70 cents per cwt on both the high and low ends this month to $13.20-$14.20 per cwt, while the mediumand short-grain 2012/13 SAFP remains forecast at $16.50-$17.50 per cwt.

Global rice production for 2012/13 is forecast at a record 465.1 million tons (milled basis), up 0.8 million tons from last month’s forecast. Production forecasts for 2012/13 were raised for India, Egypt, Australia, and the United States, but lowered for Uruguay and Haiti. Global ending stocks for 2012/13 are projected at 102.0 million tons, down 0.3 million tons from last month’s forecast, but still the second highest in a decade.

Global calendar year 2013 trade is forecast at 35.99 million tons, up 0.1 million tons from last month’s forecast, but still 5 percent below the year-earlier record. Egypt’s 2013 export forecast was raised, while 2013 export forecasts for Uruguay and China were lowered. Global trade for 2012 was raised 1.85 million tons to a record 37.7 million tons, with India accounting for the bulk of the upward revision. On the 2012 import side, Nigeria’s imports were boosted to record 3.0 million tons.

Prices for most grades of Thailand’s higher-quality non-specialty white milled-rice have declined 1-2 percent since early September, primarily due to the release of some Government held stocks. Price quotes from Vietnam have declined as well, mostly due to a lack of new demand from big regular buyers such as Indonesia, China, and the Philippines. U.S. prices for long-grain milled rice have remained steady over the past month, while prices for California rice for the domestic market have declined.

Domestic Outlook

U.S. 2012/13 Crop Forecast Raised to 198.9 Million Cwt

The 2012/13 U.S. rice crop is forecast at 198.9 million cwt, up 2.5 million cwt from last month’s forecast and 7.5 percent larger than a year earlier. This month’s upward revision was the result of a higher yield forecast. The average field yield was increased 94 pounds per acre to a record 7,428 pounds, 5 percent higher than a year earlier. Harvested area remains estimated at 2.68 million acres, an increase of 2 percent from a year earlier.

Long-grain rice production is projected at 140.1 million cwt, up 1.8 million cwt from last month’s forecast and 20 percent larger than a year earlier. Combined medium- and short-grain production is projected at 58.8 million cwt, up 0.75 million cwt from last month’s forecast, but still 14 percent below the near-record a year earlier.

Yields were raised this month for all reported States except Missouri, which is unchanged. Mississippi’s average yield was raised 200 pounds per acre and Louisiana’s yield was boosted 150 pounds. Yields were raised 100 pounds per acre in Texas and Arkansas, and boosted 50 pounds in California. Production forecasts were raised this month for all States except Missouri, with Arkansas accounting for nearly half of this month’s upward revision in the 2012/13 production forecast. Mississippi and Louisiana reported the largest percentage increases in production estimates this month, with their crop estimates raised 2-3 percent.

Yields in 2012/13 Projected To Be Record High In Arkansas, Louisiana, and Texas

On an annual basis, harvested area is estimated lower in all reported States in 2012/13 except Arkansas and Missouri, with Texas reporting the largest decline. At 134,000 acres, harvested area in Texas is 26 percent below a year earlier. The State has suffered from severe drought and has instituted water restrictions this year. At 123,000 acres, Mississippi’s harvested area is 22 percent below a year earlier and the lowest since 1977/78. California’s 2012/13 harvested area is estimated at 563,000 acres, down 3 percent from last year. Louisiana’s rice harvested area declined 4 percent from 2011/12 to 395,000 acres, the smallest since 2007/08.

In contrast, harvested rice acreage in Arkansas rose 11 percent to 1.28 million acres and harvested rice acreage in Missouri increased 38 percent to 177,000 acres. On balance, area expansions in Arkansas and Missouri more than offset area contractions in the remaining reported States, resulting in a 59,000-acre increase in U.S. harvested area in 2012/13.

Average yields are estimated higher than year-earlier in all reported States, with record yields projected for Arkansas, Louisiana, and Texas. At 7,300 pounds per acre, the average field yield in Arkansas is up 8 percent from a year earlier. In Missouri, the average yield is estimated at 6,700 pounds per acre, up 3 percent from last year. Mississippi’s average yield of 7,100 pounds per acre is almost 4 percent above a year earlier. Louisiana’s average field yield is estimated at 6,600 pounds per acre, also up more than 4 percent from a year earlier. The average Texas field yield of 8,100 pounds is up 13 percent from a year earlier and the highest ever reported for a southern State. The bulk of the southern crop was planted early this year, which typically bodes well for a high yield. In California, the average field yield is estimated at 8,450 pounds per acre, up 1 percent from a year earlier, but still 150 pounds per below the 2004/05 record.

Arkansas and Missouri account for all of the expected increase in U.S. rice production in 2012/13. At 93.4 million cwt, rice production in Arkansas is up almost 20 percent from a year earlier, a result of both expanded area and a higher yield. Missouri’s production of 11.9 million cwt is up 43 percent from a year earlier, due to larger plantings and a higher yield. In contrast, Louisiana’s rice crop of 26.4 million cwt is fractionally below last year, a result of smaller plantings. At 10.85 million cwt, the Texas 2012/13 rice crop is 16 percent below a year earlier and the smallest since 1949/50. Mississippi’s production of 8.7 million cwt is 19 percent below a year earlier, a result of smaller plantings. California’s production is projected to decline almost 2 percent from last year to 47.6 million cwt, also due to smaller plantings.

Progress of the 2012/13 U.S. crop remains well ahead of normal in much of the South. By October 7, 79 percent of the U.S. rice crop was harvested, up from 69 percent a year earlier and the U.S. 5-year average of 74 percent. In Arkansas, 95 percent of the crop was harvested by October 7, up 19 percentage points from the State’s 5-year average. Missouri’s crop was reported 92 percent harvested by October 7, well ahead of the 5- year average of 72 percent. In Mississippi, 96 percent of the crop was reported harvested by October 7, well above the State’s 5-year average of 80 percent. The entire Louisiana 2012/13 crop was reported harvested by October 7, up 2 percentage points from the State’s 5-year average. With 99 percent of the crop harvested by October 7, Texas crop progress was slightly behind last year and the State’s 5-year average. In California, 18 percent of the 2012/13 crop was harvested by October 7, compared with a 5-year average of 43 percent harvested by that date. The California crop was planted late due to adverse weather early in the season.

Total U.S. Supplies in 2012/13 Forecast Nearly 3 Percent Larger than a Year Ago

The total supply forecast for 2012/13 was raised 1 percent this month to 259.4 million cwt, almost 3 percent larger than a year earlier. Estimates for carryin and production were raised this month. By class, long-grain supplies are projected at 181.3 million cwt, up 1.8 million cwt from last month’s forecast and 7 percent larger than a year earlier. Medium- and short-grain supplies are forecast at 76.0 million cwt, an increase of .75 million cwt from last month’s forecast, but still 7 percent below a year earlier.

The 2012/13 all rice carryin estimate was fractionally raised to 41.1 million cwt, still 15 percent below a year earlier. The upward revision was the result of a revised 2011/12 milling rate. The long-grain 2012/13 carryin is estimated at 24.3 million cwt, 32 percent below a year earlier. The medium- and short-grain carryin is estimated at 14.7 million cwt, up 45 percent from a year earlier. Stocks of brokens, included in the all-rice stocks estimate, are not classified by class.

Total rice imports for 2012/13 remain projected at 19.5 million cwt, up slightly from a year earlier. Long-grain imports remain projected at 17.0 million cwt, up fractionally from a year earlier. Thailand supplies the bulk of U.S. long-grain imports, mainly shipping its premium jasmine rice, an aromatic. Basmati rice from India and Pakistan accounts for most of the remaining U.S. long-grain imports. Medium- and short-grain imports remain projected at 2.5 million cwt for 2012/13, up 3 percent from a year earlier. Specialty rice from Thailand that is classified as medium- and short-grain accounts for the bulk of U.S. medium- and short-grain imports. Arborio rice from Italy accounts for most of the remainder.

U.S. 2012/13 Domestic and Residual Use Forecast Raised 1.0 Million Cwt to 127.0 Million Cwt

Total use of U.S. rice in 2012/13 is projected at 227.0 million cwt, up 1.0 million cwt from last month’s forecast and 7 percent above a year earlier. By class, long-grain total use is projected at 163.0 million cwt, up 1.0 million cwt from last month’s forecast and 13 percent above a year earlier. Medium- and short-grain total use remains projected at 64.0 million cwt, 5 percent below a year earlier.

Total domestic and residual use of all-rice in 2012/13 is projected at 127.0 million cwt, up 1.0 million cwt from last month’s forecast and 15 percent higher than the year-earlier revised estimate. This month’s upward revision in the 2012/13 domestic and residual use estimate is based on a larger U.S. crop. For long-grain, 2012/13 domestic and residual use is projected at 95.0 million cwt, up 1.0 million cwt from last month’s forecast and 22 percent larger than a year earlier. Medium- and short-grain domestic and residual use remains projected at 32.0 million cwt, down 1 percent from a year earlier.

Total exports of U.S. rice in 2012/13 remain projected at 100.0 million cwt, almost 2 percent below a year earlier. By type, U.S. rough-rice exports remain projected at 33.0 million cwt, up 1 percent from a year earlier. Latin America is expected to remain the largest market for U.S. rough-rice exports, with Mexico the biggest buyer. Milled rice exports (combined milled- and brown-rice exports converted to a rough-basis) are projected at 67.0 million cwt, nearly 3 percent below a year earlier.

By class, long-grain exports remain projected at 68.0 million cwt, 2 percent above a year earlier. Medium- and short-grain exports remain projected at 32.0 million cwt, 8 percent below the year-earlier near-record. Some of the projected year-to-year decline is based on weaker U.S. shipments to Northeast Asia due to the timing of the region’s annual WTO imports. U.S. shipments to the region were abnormally high in 2011/12. Competition with Australia and Egypt will likely be more intense as well.

U.S. ending stocks of all-rice in 2012/13 are projected at 32.4 million cwt, up 1.6 million cwt from last month’s forecast, but 21 percent below a year earlier. The stocks-to-use ratio is calculated at 14.3 percent, down from 19.4 percent in 2011/12. By class, the 2012/13 U.S. long-grain carryout is projected at 18.3 million cwt, up 0.8 million cwt from last month’s forecast, but 24.5 percent below a year earlier. The long-grain stocks-touse ratio is calculated at 11.2 percent, down from 16.8 percent a year earlier and the lowest since 2003/04. The medium- and short-grain carryout is projected at 12.0 million cwt, up 0.8 million cwt from last month’s forecast, but 18 percent below a year earlier. The medium/short-grain stocks-to-use ratio is calculated at 18.7 percent, down from 21.9 percent in 2011/12.

The 2011/12 milling rate was lowered to 69.93 percent from a preliminary estimate of 70.00 percent based on year-end monthly milling data. The new milling rate resulted in slightly higher estimates for exports and ending stocks. These revisions were offset by a slight change in the 2011/12 domestic and residual estimate.

U.S. 2012/13 Season-Average Price Forecast Raised for Long-Grain Rice

The 2012/13 season-average farm price (SAFP) for U.S. long-grain rice was raised 70 cents per cwt on both the high and low ends this month to $13.20-$14.20 per cwt, compared with $13.40 per cwt a year earlier. The upward revision was based on NASS prices through mid-September and expectations regarding prices the remainder of the market year. The combined medium- and short-grain 2012/13 U.S. SAFP remains forecast at $16.50-$17.50 per cwt, compared with $16.50 a year earlier. U.S. rough-rice prices are being supported by higher prices for other grains and soybeans.

In late September, NASS reported a mid-September U.S. long-grain rough-rice price of $14.10 per cwt, up 10 cents from the revised August estimate. The August price was raised 20 cents from the mid-month estimate to $14.00. For combined medium- and short-grain rice, the mid-September NASS price was reported at $16.90 per cwt, up $1.00 from the revised August price. The August price was lowered 40 cents from the mid-month estimate to $15.90.

International Rice Market

Global Rice Production in 2012/13 Forecast to be the Highest on Record

Global rice production for 2012/13 is forecast at a record 465.1 million tons (milled basis), up 0.8 million tons from last month’s forecast and fractionally above a year earlier. Global rice area is projected at 158.7 million hectares, fractionally below a year earlier, with India accounting for most of the year-to-year decline. The average global yield is forecast at a record 4.37 tons per hectare, fractionally above 2011/12.

India accounts for the bulk of this month’s upward revision in 2012/13 global rice production. India’s 2012/13 rice crop was raised 1.0 million tons to 99.0 million tons, based on a higher yield. The crop is still 5 percent below the year earlier record. Lateseason monsoon rains in eastern and northeastern rice areas in August and September were quite favorable for the kharif crop, with the Government of India’s First Advance Estimate pegging the kharif crop at 85.6 million tons. The favorable rains bode well for a normal rabi crop to be harvested in early 2013. In East Asia, Japan’s 2012/13 rice crop was raised 142,000 tons to 7.5 million tons based on expectations of an average yield. Weather has been favorable in Japan thus far in the 2012/13 growing season. Despite the upward revision, the crop is 2 percent below a year earlier and the smallest since 2003/04.

Outside Asia, Egypt’s 2012/13 production was raised 200,000 tons to 4.7 million tons based on a higher yield, a result of sufficient water for irrigation. Both production, and area estimated a 740,000 hectares, are the highest on record. Australia’s 2012/13 crop was boosted 80,000 tons to 800,000 tons based on the September ABARE report indicating larger area and a higher yield, both attributed to sufficient water. At 121,000 hectares, rice area in Australia is the highest since 2001/02. The country suffered from severe drought much of this century. The crop is 15 percent larger than a year earlier. Both Egypt and Australia are major medium- and short-grain exporters, typically competing with the United States. The U.S. 2012/13 crop was increased 81,000 tons to 6.34 million due to a higher yield reported by the Government’s statistical agency. The U.S. average yield this year is the highest on record. Ukraine’s 2012/13 production was slightly raised this month based on a higher yield reported by the government.

These upward 2012/13 production revisions were partially offset by two reductions. First, Uruguay’s 2012/13 production forecast was lowered 56,000 tons to 840,000 based on a lower area estimate. Uruguay’s 2012/13 rice area was lowered 10,000 hectares to 150,000 based on higher expected returns for competing crops, primarily soybeans. Second, Haiti’s 2012/13 milled crop was lowered 20,000 tons to 120,000 tons based on a lack of rainfall throughout the growing season that has lowered the yield.

There were two small production revisions for 2011/12. First, Argentina’s production was raised 33,000 tons to 1.0 million tons based on a higher yield reported by the Government. Second, the U.S. crop was fractionally raised to 5.87 million based on a slightly lower milling yield. In addition, there were several production revisions this month for Sub-Saharan Africa for both 2011/12 and 2012/13.

Global rice disappearance for 2012/13 is projected at a record 468.6 million tons, up 0.9 million from last month’s forecast and 2 percent larger than a year earlier. Consumption forecasts were raised this month for China, India, Japan, Nigeria, and the United States, but lowered for Bangladesh, Burma, and Egypt. On a year-to-year basis, Bangladesh, Burma, China, India, Indonesia, Thailand, the United States, and Vietnam account for most of the expected increase in global domestic use.

Global ending stocks for 2012/13 are projected at 102.0 million tons, down 0.3 million tons from last month’s forecast and 3.5 million tons below a year earlier. Despite the downward revision, global ending stocks in 2012/13 are the second highest in a decade. India accounts for most of this month’s downward revision in global ending stocks. The global stocks-to-use ratio for 2012/13 is calculated at 21.8 percent, down from 23.0 percent a year earlier.

India’s 2012 Exports Are Projected at a Record 9.75 Million Tons

Global calendar year 2013 trade is forecast at 35.99 million tons, up 0.1 million tons from last month’s forecast, but still 5 percent below the year-earlier record. There were four, largely offsetting, 2013 export revisions this month. First, Egypt’s 2013 export forecast was raised 250,000 tons to 850,000 tons based on the announcement by the Government on October 1 of the end of its export ban and larger supplies. These are the largest exports for Egypt since 2007 and the imposition of export restrictions in 2008. Second, Venezuela’s 2013 export forecast was raised 35,000 tons to 50,000 based on an expected continuation of its current shipment pace. Third, China’s 2013 export forecast was lowered 100,000 tons to 500,000 tons based on expectations of continued uncompetitive prices. Fourth, Uruguay’s 2013 export forecast was lowered 50,000 tons to 800,000 tons based on smaller supplies.

There were several 2013 significant import revisions this month. First, China’s 2013 imports raised 200,000 tons to 1.5 million based on expectations of a continuation of this year’s strong pace. Second, Iraq’s 2013 import forecast was raised 100,000 tons to 1.3 million tons based on expected stronger demand. Third, Turkey’s 2013 imports were raised 80,000 tons to 300,000 tons based on a stronger pace in 2012 and the recent lifting of Egypt’s export ban. Fourth, Nepal’s 2013 imports were increased 70,000 tons to 220,000 based on record purchases from India in 2012. There were smaller upward revisions in 2013 import forecasts this month for Saudi Arabia, Cameroon, Angola, Panama, and Jordan.

These upward revisions were partially offset by 3 reductions. First, Egypt’s 2013 import forecast was lowered 600,000 tons to 150,000 tons based on information from the U.S. Agricultural Counselor in Cairo noting that the government will supply its ration cards from domestic supplies. Second, Bangladesh’s 2013 imports were lowered 250,000 tons to 250,000 tons based on a weaker import pace in 2012. Bangladesh’s imports have sharply dropped in recent years. Third, Australia’s 2013 import forecast was lowered 35,000 tons to 35,000 tons to 90,000 tons based on a larger crop.

Global trade for 2012 was raised 1.85 million tons to a record 37.7 million, up 4 percent from a year earlier. On the export side, India’s exports were raised 1.75 million tons to a record 9.75 million based on a record pace of shipments to date and larger supplies. This makes India the largest rice exporter in 2012, a first for India. Burma’s 2012 exports were raised 150,000 tons to 750,000 tons, also based on shipment pace. Venezuela’s 2012 exports were revised up 35,000 tons to 50,000 tons based on an expected continuation of recent levels. These upward revisions were partially offset by a 100,000-ton reduction in China’s 2012 exports to 400,000 tons based on shipment pace and uncompetitive prices.

There were several significant 2012 import revisions this month. First, Nigeria’s 2012 import forecast was raised 550,000 tons to a record 3.0 million based on large stocks held by traders and expectations of higher levies. China’s 2012 imports were raised 400,000 tons to 1.9 million based on a much stronger pace to date. These are the largest imports for China since 1995. Senegal’s imports were raised 130,000 tons to a record 950,000 based on shipment pace. India has supplied most of this rice. Ghana’s 2012 imports were increased 75,000 tons to 475,000 based on stronger demand.

Smaller upward revisions in 2012 import forecast were made this month for Cote D’Ivoire, Kenya, Madagascar, South Africa, Nepal, Turkey, Tanzania, Cameroon, Somalia, Angola, Venezuela, Jordan, and Panama. Most Sub-Saharan African import revisions were based on revised production estimates.

These upward import revisions were partially offset by three reductions. First, Bangladesh’s 2012 imports were lowered 160,000 tons to 240,000 tons based on a slower-than-expected pace. Second, Australia’s imports were lowered 20,000 tons to 130,000 based on a slow pace. And finally, Egypt’s 2012 imports were reduced 250,000 tons to 250,000 tons to 550,000 tons, also based on a slower pace and a larger crop forecast.

Export Prices from Thailand and Vietnam Have Declined

Prices for most grades of Thailand’s higher-quality non-specialty white milled-rice have declined 1-2 percent since early September, primarily due to the release of some Government held stocks. Prices for Thailand's high-quality, 100-percent Grade B (fob vessel, Bangkok) milled rice for export were quoted at $569 per ton for the week ending October 8, down $12 from the week ending September 10. Prices for Thailand’s 5-percent brokens were quoted at $557 per ton for the week ending October 8, also down $12 from the week ending September 10.

Prices for Thailand's 5-percent parboiled rice—a specialty rice—were quoted at $591 per ton for the week ending October 8, down $23 from the week ending September 10. In contrast, prices for Thailand’s brokens have remained steady over the past month. For the week ending October 8, prices for Thailand’s A-1 Super 100-percent brokens were quoted at $512 per ton, unchanged from a month earlier. Price quotes for Thailand’s premium jasmine rice—an aromatic—were quoted at $1,078 per ton for the week ending October 8, up $22 from the week ending September 10 and the highest since December. All price quotes for Thailand’s rice are from the Weekly Rice Price Update, reported by the U.S. Agricultural Counselor in Bangkok.

Price quotes from Vietnam have declined as well, mostly due to a lack of new demand from big regular buyers such as Indonesia, China, and the Philippines. For the week ending October 9, prices for Vietnam’s 5-percent double-water-polished with 5-percent brokens were quoted at $440 per ton—down $15 per ton from the week ending September 11. Thailand’s price quotes for 5 percent brokens are currently $117 per ton above quotes for Vietnam’s 5-percent double-water-polished milled rice, up $3 per ton from a month earlier.

U.S. prices have long-grain milled rice have remained steady over the past month. For the week ending October 9, prices for high-quality Southern long-grain rice (No. 2, 4- percent brokens, bagged, free alongside vessel, U.S. Gulf port) were quoted at $590 per ton, unchanged since late August. U.S. long-grain rough-rice (bulk, fob vessel, New Orleans) was quoted at $360 per ton for the week ending October 9, down $10 per ton from the week ending September 11.

In contrast, prices for California rice for the domestic market have declined slightly over the past month. California’s package-quality medium-grain rice (sacked) for domestic sales was quoted at $783 per ton for the week ending October 9, down $11 from the week ending September 11. Export prices (for 30-kg bags, fob vessel) for California milled rice were quoted at $825 per ton for the week ending October 9, down $20 from a week earlier. The pace of export sales has been slow this market year. Price quotes for Vietnam, U.S. long- and medium-grain milled-rice prices, and U.S. rough-rice export prices are from the weekly Creed Rice Market Report.

October 2012

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