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USDA Rice Outlook


13 February 2013

USDA Rice Outlook - February 2013USDA Rice Outlook - February 2013

The only supply-side revision this month to 2012/13 US rice balance sheet (on a rough-equivalent basis) was a 0.5-million cwt increase in imports to 21.0 million cwt, up 8.5 percent from a year earlier. The US crop remains estimated at 199.5 million cwt, 8 percent larger than a year earlier. The 2012/13 all rice carryin remains estimated at 41.1 million cwt, 15 percent below a year earlier. Total supplies were raised slightly to 261.6 million cwt, 3.5 percent larger than a year earlier.
USDA Rice Outlook

US 2012/13 Rice Import Forecast Raised to 21.0 Million Cwt

There were no revisions to the use side of the 2012/13 US rice balance sheet this month. Total domestic and residual use remains projected at 125.0 million cwt, 13.5 percent higher than a year earlier. Total exports of US rice in 2012/13 remain projected at 106.0 million cwt, more than 4 percent above a year earlier. The US ending stocks forecast was increased 0.5 million cwt to 30.6 million cwt, 26 percent below a year earlier.

The 2012/13 season-average farm price (SAFP) for US long-grain rice is forecast at $14.00-$14.60 per cwt, with the mid-point up 10 cents from the mid-point of last month’s forecast of $13.70-$14.70 per cwt. The combined medium- and short-grain 2012/13 US SAFP is forecast at $15.90-$16.50 per cwt, with the mid-point down 30 cents from last month’s mid-point.

Global rice production for 2012/13 is forecast at a record 465.8 million tons (milled basis), fractionally above last month’s forecast. Production forecasts were raised this month for Bangladesh, Nepal, Bolivia, and Ukraine; but lowered for Argentina, Laos, and Panama. Global rice use (including a residual component) for 2012/13 is projected at a record 469.3 million tons, up 0.7 million tons from last month’s forecast. The 2012/13 global ending stocks forecast was lowered 0.5 million tons to 101.95 million.

Total calendar year 2013 global rice trade is forecast at 37.1 million tons, down 0.2 million tons from last month’s forecast and 1.9 million tons below the year-earlier record. Import forecasts for 2013 were lowered for Indonesia, Egypt, Brazil, and Bolivia; but raised for China, Iraq, and Panama. On the export side, 2013 forecasts were lowered for China, Argentina, and Russia.

Prices for most grades of Thailand’s higher quality white milled-rice increased slightly over the past month, mostly due to tighter exportable supplies and some strengthening of the Thai baht. Price quotes from Vietnam continue to decline, mostly due to a lack of major new sales and expectations of a bumper winter-spring harvest to begin later this month. US prices for long-grain milled rice have declined slightly over the past month, partly due to a slowdown in sales over the holidays. Prices for California milled rice for the US market have remained unchanged over the past month, but declined for the global market.

Domestic Outlook

US 2012/13 Rice Import Forecast Raised to 21.0 Million Cwt

The only supply side revision this month to the 2012/13 US rice balance sheet (on a rough-equivalent basis) was a 0.5-million cwt increase in imports to 21.0 million cwt, up 8.5 percent from a year earlier. These are the second highest imports on record. This month’s upward revision was based on US shipment data through November and expectations regarding imports the remainder of the market year.

Thailand remains the largest supplier, accounting for around 70 percent of US rice imports. India and Pakistan typically account for the bulk of the remaining US rice imports. Specialty rices, mostly aromatics, account for nearly all of shipments to the United States from these three major Asian exporters. This year, Vietnam shipped almost 37,000 tons of brokens to the US in September. Vietnam typically supplies little rice to the United States.

Long-grain accounted for all of the upward revision in US rice imports this month. At 18.5 million cwt, US long-grain imports are up 0.5 million cwt from last month’s forecast and 9 percent larger than a year earlier. These are the highest US long-grain imports on record. 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, classified as medium- and short-grain, accounts for the bulk of US medium- and short-grain imports. Arborio rice from Italy accounts for most of the remainder.

The US crop remains estimated at 199.5 million cwt, 8 percent larger than a year earlier, a result of both expanded area and a record yield. Harvested area remains estimated at 2.68 million acres, up 2 percent from a year earlier, but still the second smallest since 1987/88. The 2012/13 average yield remains estimated at 7,449 pounds per acre, 382 pounds above last year. Early planting across much of the South was a major factor behind the record yield.

The 2012/13 US long-grain crop remains estimated at 144.2 million cwt, an increase of 24 percent from a year earlier. At a record 7,285 pounds per acre, the long-grain average yield is up 594 pounds from a year earlier. Long-grain harvested area remains estimated at 1.98 million acres, 14 percent larger than a year earlier. Almost all US long-grain rice is grown in the South.

The combined medium- and short-grain 2012/13 crop remains estimated at 55.3 million cwt, 19 percent below a year earlier. The smaller crop is the result of reduced plantings. Combined medium- and short-grain plantings declined 21 percent to 705,000 acres, with the South accounting for the bulk of the decline. California produces about 70 percent of the US medium- and short-grain crop. Arkansas and Louisiana supply most of the remainder. The US medium- and short-grain yield remains estimated at 7,914 pounds, up more than 1 percent from a year earlier.

In 2012/13, harvested area was smaller than a year earlier in all reported States except for Arkansas and Missouri. In 2011/12, severe early-season flooding reduced and delayed plantings in both Arkansas and Missouri. Average US yields in 2012/13 were higher than a year earlier in all reported States except for California, with record yields reported for Arkansas, Louisiana, Missouri, and Texas. In 2012/13, California growers experienced a wet spring, an extremely hot August, and a cool, wet fall, resulting in a late harvest. Production in 2012/13 declined in all reported States except for Arkansas and Missouri.

The 2012/13 all rice carryin remains estimated at 41.1 million cwt, 15 percent below a year earlier. The long-grain 2012/13 carryin remains estimated at 24.3 million cwt, 32 percent below a year earlier. The medium- and short-grain carryin remains 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 supplies for 2012/13 are forecast at 261.6 million cwt, up 0.5 million cwt from last month’s forecast and 3.5 percent larger than a year earlier. A larger crop and record imports are projected to more than offset a much smaller carryin. By class, long-grain supplies are projected at 186.9 million cwt, up 0.5 million cwt from last month’s forecast and 11 percent larger than a year earlier. Medium- and short-grain supplies remain forecast at 72.5 million cwt, 11 percent below a year earlier.

US Long-Grain Exports Are Projected To Increase 12 Percent in 2012/13

There were no revisions to the use side of the 2012/13 US rice balance sheet this month. Total use of US rice in 2012/13 remains projected at 231.0 million cwt, 9 percent above a year earlier. By class, long-grain total use remains projected at 169.0 million cwt, 17 percent above a year earlier. Medium- and short-grain total use remains projected at 62.0 million cwt, more than 7 percent below a year earlier. The expected decline is mostly due to tighter supplies and higher prices.

Total domestic and residual use of all-rice in 2012/13 remains projected at 125.0 million cwt, 13.5 percent higher than a year earlier. For long-grain, 2012/13 domestic and residual use remains projected at 94.0 million cwt, 21 percent larger than a year earlier. Medium- and short-grain domestic and residual use is projected at 31.0 million, 4 percent below a year earlier.

Total exports of US all rice in 2012/13 remain projected at 106.0 million cwt, more than 4 percent above a year earlier. By type, US rough-rice exports remain projected at 34.0 million cwt, 4 percent larger than a year earlier. Through January 2013, total US sales to both Mexico and Central America were well ahead of a year earlier. These are the two largest markets for US rough-rice, taking almost exclusively long-grain.

Milled rice exports (combined milled- and brown-rice exports converted to a rough basis) remain projected at 72.0 million cwt, 4.5 percent above a year earlier. Northeast Asia, the Caribbean, the Middle East, and Canada are the largest markets for US milled rice exports. Haiti is the largest market for US milled rice in the Western Hemisphere, taking almost exclusively longgrain rice.

By class, long-grain exports are projected at 75.0 million cwt, 12 percent above a year earlier. South America has been a stronger buyer in 2012/13 than a year earlier. In addition, Iran has purchased 60,000 tons of US longgrain milled rice for shipment later this year. These are the first significant purchases of US rice by Iran since 2008/09. Medium- and short-grain exports remain projected at 31.0 million cwt, 11 percent below the yearearlier near-record. Some of the projected decline is based on stronger competition with Australia and Egypt.

US ending stocks of all-rice in 2012/13 are projected at 30.6 million cwt, up 0.5 million cwt from last month’s forecast, but still 26 percent below a year earlier. The stocks-to-use ratio is calculated at 13.2 percent, down from 19.4 percent in 2011/12. By class, the 2012/13 US long-grain carryout is projected at 17.9 million cwt, up 0.5 million cwt from last month’s forecast, but 26 percent below a year earlier. The long-grain stocks-to-use ratio is calculated at 10.6 percent, down from 16.8 percent a year earlier. The medium- and short-grain carryout remains projected at 10.5 million cwt, almost 29 percent below a year earlier. The medium/short-grain stocks-touse ratio is calculated at 16.9 percent, down from 21.9 percent in 2011/12.

US 2012/13 Long-Grain Season-Average Price Forecast Raised

The 2012/13 season-average farm price (SAFP) for US long-grain rice is forecast at $14.00-$14.60 per cwt, with the mid-point up 10 cent from the mid-point of last month’s forecast of $13.70-$14.70 per cwt. The 2012/13 long-grain SAFP is well above the 2011/12 SAFP of $13.40 per cwt. The upward revision was based on monthly reported cash prices through mid- January and expectations regarding prices for the remainder of the market year. The higher US long-grain price in 2012/13 is primarily due to stronger global demand for US rice and expectations of a tight US ending stocks situation. However, the US price increase is limited by weaker global trading prices.

The combined medium- and short-grain 2012/13 US SAFP is forecast at $15.90-$16.50 per cwt, with the mid-point down 30 cents from last month’s mid-point. In late January, USDA raised the 2011/12 medium- and shortgrain SAFP by 60 cents per cwt to $17.10 based on revised monthly prices and marketings. Greater competition from Egypt and Australia in the global market accounts for some of the projected price decline for US mediumand short-grain rice in 2012/13.

In late January, NASS reported a mid-January US long-grain rough-rice price of $14.70 per cwt, up 60 cents from the revised December estimate and the highest since January 2009. The December price was lowered 10 cents from the mid-month estimate to $14.10. For combined medium- and shortgrain rice, the mid-January NASS price was reported at $15.50 per cwt, down 60 cents from the December price. The December price remains estimated at $16.10.

International Outlook

Production Forecasts for 2012/13 Lowered for Argentina, Laos, and Panama

Global rice production for 2012/13 is forecast at a record 465.8 million tons (milled basis), fractionally above last month’s forecast and up 0.8 million tons from a year earlier. Global rice area is projected at 158.4 million hectares, 0.6 million hectares below the year-earlier record, with India accounting for most of the year-to-year decline. The average global yield is forecast at a record 4.38 tons per hectare, fractionally above 2011/12.

There were four upward revisions to 2012/13 production forecasts this month, with two in South Asia. First, Bangladesh’s production was raised 0.2 million tons to a record 34.0 million tons based on information from the USDA office in Dhaka indicating a record yield. In nearby Nepal, the 2012/13 production estimate was raised 100,000 tons to a record 3.0 million tons, also based on a higher yield. The yield was raised based on revised back-year yields. Third, Bolivia’s 2012/13 production estimate was raised 74,000 tons to a record 364,000 tons based on a much larger area estimate and a higher yield. Finally, Ukraine’s 2012/13 crop was raised 3,000 tons to 103,000 tons based on year end Government data.

These upward revisions were partially offset by four reductions. First, Argentina’s 2012/13 production forecast was lowered 32,000 tons to 1.008 million tons based on information from the USDA office in Buenos Aries indicating a weaker yield. In general, the crop is reported in good condition. However, due to excess rain during the October planting season, most plantings in Entre Rios, Santa Fe, and south Corrientes were delayed until November, reducing potential yields. Second, Panama’s 2012/13 crop forecast was lowered 34,000 tons to 175,000 tons based on information from FAO indicating smaller area. Higher production costs and a water shortage are reported as the reasons behind the decline in rice acreage and production in Panama. Outside the Western Hemisphere, Laos’ 2012/13 production forecast was lowered 55,000 tons to 1.48 million tons based mostly on a weaker area estimate. The 2012/13 area forecast was reduced based on lower area estimates for 2011/12 and 2010/11. Finally, Russia’s 2012/13 crop estimate was lowered 2,000 tons to 683,000 tons based on year-end data from the Russian Federal State Statistics Service.

The 2011/12 global crop estimate was raised fractionally this month to 465.0 million tons, up 3.5 percent from a year earlier. There was one upward revision. Nepal’s 2011/12 crop estimate was raised 70,000 tons to 2.97 million tons based on FAO data indicating a much higher yield, although slightly lower area. This increase was nearly offset by a 47,000-ton reduction in Laos’ 2011/12 production to 2.97 million tons based on smaller area and a weaker yield caused by late-season flooding.

Global rice use (including a residual component) for 2012/13 is projected at a record 469.3 million tons, up 0.7 million tons from last month’s forecast and, but more than 2 percent larger than a year earlier. The consumption forecast was raised for Iraq and Nepal, but lowered for Brazil and Cuba. On a year-to-year basis, Bangladesh, Burma, China, India, Indonesia, Sub-Saharan Africa, Thailand, the United States, and Vietnam account for most of the expected increase in global domestic and residual use.

Global ending stocks for 2012/13 are projected at 101.95 million tons, down 0.5 million tons from last month’s forecast and 3.5 million tons below a year earlier. Ending stocks forecasts were lowered this month for Indonesia, but raised for China and the United States. Despite the downward revision, global ending stocks in 2012/13 are the second highest in a decade. On a year-to-year basis, stocks are projected to be smaller in India, Indonesia, the United States, and Vietnam, but higher in China, Pakistan, and Thailand. The global stocks-to-use ratio for 2012/13 is calculated at 21.7 percent, down from 23.0 percent a year earlier.

Import Forecasts for 2013 Lowered For Cuba, Egypt, and Indonesia

Total calendar year 2013 global rice trade is forecast at 37.1 million tons, down 0.2 million tons from last month’s forecast and 1.9 million tons below the year-earlier record. There were three 2013 export revisions this month, all reductions. First, China’s 2013 export forecast was lowered 200,000 tons to 300,000 tons based on recommendations from the USDA office in Beijing. Second, Argentina’s 2013 export forecast was lowered 25,000 tons to 625,000 tons based on a smaller crop and weaker exports in 2012. Finally, Russia’s 2013 export forecast was reduced 10,000 tons to 160,000 based on recommendations from the USDA office in Moscow.

There were several 2013 import revisions this month. On the downside, Indonesia’s 2013 import forecast was lowered 650,000 tons to 800,000 tons based on recommendations from the USDA office in Jakarta. Indonesia’s 2013 imports are nearly 1.2 million tons below 2012. Egypt, a net-exporter, is projected to import just 50,000 tons of rice in 2013, down 100,000 tons from last month’s forecast and 300,000 tons below last year. The remaining downward revisions are in Latin America. Brazil’s 2013 import forecast was lowered 50,000 tons to 700,000 tons based on information from the USDA office in Brasilia. Finally, Bolivia’s 2013 import forecast was lowered 35,000 tons to just 5,000 tons based on a much larger crop forecast.

These downward revisions in 2013 import forecasts were partially offset by three upward revisions. First, China’s 2013 import forecast was raised 200,000 tons to 2.2 million tons based on recommendations from the USDA office in Beijing. Despite the upward revisions, China’s imports are still below the 2013 record. Iraq’s 2013 import forecast was raised 100,000 tons to 1.45 million tons based on a stronger pace of deliveries in recent months. Finally, Panama’s 2013 import forecast was increased 30,000 tons to 85,000 tons based on a smaller crop and larger 2012 imports.

The 2012 global rice trade estimate was lowered fractionally to 39.0 million tons, still up 2.8 million tons from a year earlier and the highest on record. The substantial trade volume reported in 2012 was largely the result of record shipments from India and Vietnam and historically large imports by China and West Africa. Imports in 2012 were record-high for China, Côte d’Ivoire, Ghana, Nigeria, and Senegal. Rice from India and Vietnam was competitively priced in 2012, a major factor driving the large purchases.

There were 5 downward revisions to the 2012 import estimates this month. Three are in Asia. First, Bangladesh’s 2012 imports were lowered 210,000 tons to just 30,000 tons based on data from the USDA office in Dhaka. These are the lowest imports for Bangladesh since 1991. Second, Laos’ imports were reduced 17,000 tons to 13,000 tons. And third, South Korea’s 2012 imports were lowered 2,000 tons to 238,000 tons. Revisions for Laos and South Korea were based on year end trade data. Outside Asia, Egypt’s 2012 imports were lowered 200,000 tons to 350,000 tons. Cuba’s 2012 import forecast was lowered 120,000 tons to 330,000 tons. These are the lowest imports for Cuba since 1997. Finally, Bolivia’s 2012 imports were lowered 9,000 tons to 11,000 tons. All three downward revisions are based on year end trade data.

These downward revisions were partially offset by several upward revisions, with two in Asia. First, Indonesia’s 2012 imports were revised up 260,000 tons to 1.96 million based on recommendations from the USDA office in Jakarta. And second, Nepal’s 2012 imports were raised 45,000 tons to 265,000 tons based on near-final trade data.

There were five upward revisions to 2012 imports in Latin America. First, Mexico’s 2012 imports were raised 35,000 tons to 675,000. Second, Peru’s 2012 imports were increased 29,000 tons to 259,000 tons. Third, Panama’s 2012 imports were raised 13,000 tons to 88,000 tons. And finally, Brazil’s 2012 imports were increased 12,000 tons to 732,000 and Chile’s were raised 12,000 tons to 142,000 tons. All were based on year end trade data. In the Middle East, Iraq’s 2012 imports were raised 120,000 tons to 1.47 million tons, the highest on record and up more than 400,000 tons from 2011.

Thailand’s Trading Prices Rise Slightly on Tighter Supplies

Prices for most grades of Thailand’s higher quality white milled-rice increased slightly over the past month, mostly due to tighter exportable supplies and some strengthening of the Thai baht. Prices for lower-quality rice have declined.

Prices for Thailand's high-quality, 100-percent Grade B (fob vessel, Bangkok) milled rice for export were quoted at $576 per ton for the week ending February 5, up $5 from the week ending January 7. Prices for Thailand’s 5-percent brokens were quoted at $564 per ton for the week ending February 5, up $3 from the week ending January 7. Prices for Thailand's 5-percent parboiled rice were quoted at $576 per ton for the week ending February 5, up $7 from the week ending January 7.

Price quotes for Thailand’s premium jasmine rice—an aromatic variety—were quoted at $1,118 per ton for the week ending February 5, up $39 from the week ending January 7. In contrast, prices for Thailand’s brokens have declined. For the week ending February 5, prices for Thailand’s A-1 Super 100-percent brokens were quoted at $533 per ton, down $4 from the week ending January 7. All price quotes for Thailand’s rice are from the Weekly Rice Price Update, reported by the USDA office in Bangkok.

Price quotes from Vietnam continue to decline, mostly due to a lack of major new sales and expectations of a bumper winter-spring harvest to begin later this month. For the week ending February 5, prices for Vietnam’s 5-percent double-waterpolished with 5-percent brokens were quoted at $390 per ton—down $25 per ton from the week ending January 8. Thailand’s price quotes for 5-percent brokens are currently $176 per ton above quotes for Vietnam’s 5-percent double-water-polished milled rice, up $30 per ton from a month earlier.

US prices for long-grain milled rice have declined slightly over the past month, partly due to a slowdown in sales over the holidays. Despite a small decline over the past month, US long-grain milled prices remain above December and early January levels. For the week ending February 5, prices for high-quality Southern long-grain rice (No. 2, 4-percent brokens, bagged, free alongside vessel, US Gulf port) were quoted at $612 per ton, down $5 from the week ending January 8. In contrast, US long-grain rough-rice (bulk, fob vessel, New Orleans) were quoted at $370 per ton for the week ending February 5, up $10 per ton from the week ending January 8. US rough-rice sales to core markets in Latin America were strong during the first half of the market year.

Prices for California milled rice for the US market have remained unchanged over the past month. California’s package-quality medium-grain rice (sacked) for domestic sales remain quoted at $750 per ton for the week ending February 5, unchanged since late December. In contrast, export prices have declined. Export prices (for 30 kg bags, fob vessel) for California milled rice were also quoted at $700 per ton for the week ending February 5, down $50 from the week ending January 8. There have been few new sales of medium- and short-grain milled rice since early January. Price quotes for Vietnam, US long- and medium-grain milled-rice prices, and US rough-rice export prices are from the weekly Creed Rice Market Report.

February 2013

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