With 10 weeks remaining in the 00/01-marketing season (ending July 31) 302,000 tons of rice sold for the marketing year still requires shipping, including 274,500 tons of long grain rice.
According to the U.S. Department of Agriculture, total cumulative U.S. rice export commitments for marketing year 00/01 as of May 17 stood at 2.525 million tons (product weight basis), a 8.4% decline from totals in marketing year 99/00.
The U.S. long grain barge market is very quiet as exporters appear to be covered. Bids have dropped by $0.50 per cwt, while sellers' price ideas have remained unchanged. Above average rice planting and emergence in the country has helped to reduce rice futures buying interest. Most futures contracts continue to hover near contract lows set last week.
On Monday May 21, the USDA reported that the U.S. rice crop was 95% planted and 81% emerged. Both figures are ahead of the five-year average for the date. Seventy-two percent of the U.S. rice crop is reported in good to excellent condition.
After moving higher during the past few weeks on heavy export and sales activity, Vietnamese rice prices dropped slightly as a result of thinning fresh demand before stabilizing and firming slightly. Prices are expected to remain steady or firm somewhat as heavy shipment activity on previously concluded sales to Africa, the Philippines, and Cuba continues.
In an effort to keep supplies off the market and boost prices, the Government of Vietnam has decided to extend a plan to stockpile 1 million tons of rice from six months to one year. In the program, which began early March, the Vietnamese government is extending various financial support to companies holding supplies. New summer-autumn crop supply should begin to enter the market in late June.
Thai prices are mostly steady in quiet export activity. Shipments to South Africa, Malaysia, the Philippines, Brunei and Africa are helping to support prices. Limited new demand is primarily centered on parboiled and fragrant rice. Although 2001 Thai rice exports of 2.2 million tons are leading the rate set last year for the same period by approximately 100,000 tons, the dollar value netted by 2001 exports has dropped by $98 million to $437 million.
Negotiations by the Thai government so far have failed to net any sales. In the latest setback, the Thai government was unable to arrange an agreement with China to increase Thai rice imports from 200,000 to 400,000 tons as was widely expected. Negotiations with Malaysia to increase Thai rice purchases in exchange for boosted purchases by Thailand of Malaysian oil and other products remain possible. Currently Malaysia buys about 50%, or 300,000 tons of their annual rice imports needs, from Thailand.
Prices in Pakistan are steady to higher. Traders estimate that millers are holding on to around 200,000 tons of rice, but are unwilling to sell this due to fears of a reduced and delayed harvest caused by the current severe water shortage in the country. In early projections, some traders believe rice output in Pakistan for the next crop could be down by as much as 10-15%.
According to statistics from the Chinese government, rice exports from the country January through April totaled 590,408 tons, a 45% decline from exports during the same period last year. The destinations for this rice were the Ivory Coast (319,630 tons), Cuba (73,667 tons), Japan (58,118 tons), Iraq (46,120 tons), Russia (21,003 tons), Madagascar (15,650 tons), Malaysia (13,000 tons) and Libya (10,000 tons).
The government of India indicated that they would delay the price announcement on the release of 3 million tons of rice already authorized for export. Many in the trade believe the announcement will not come until June when the government determines whether there will be sufficient rainfall for the next crop. India is counting on a heavy monsoon season this year to boost water supplies and support agriculture. Last year, India had less rainfall than was expected, leading to water shortages in many western and central parts of the country. Monsoonal activity has now started in India, one week earlier than expected.
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