USDA’s World Market Price factors were lowered this week. The on-farm value of long grain rough is now $11.00 per cwt.
Rice futures had the usual dull, weak sideways action until Wednesday at 9 a.m. After a light and uneventful overnight session, the shorts looked at the Iraq potential for buying and decided it was time to cover their positions.
The market moved from a low on Wednesday of 11.97 to a high of 12.60 in the nearby Jan contract during Friday’s session, with settlement just a half-cent off that high and 62.5 cents above the previous Friday settlement. Volume was rather mediocre during the week, with open interest near 9,800 contracts at Thursday’s close.
Technically there should be a little more on the upside – after that it will be interesting to see just how much selling is willing to engage this market. Nothing would surprise us, but it does look to us like it will be difficult to get this market under 12.00 or even very close to it now in the nearby Jan.
We fully recognize, though, that futures markets are full of curve balls, and rice futures have some spit balls thrown in for good measure. So, be careful out there folks – as we have said previously, if trading rice or any other futures contracts, use calm decision making and good money management before taking any positions.
In other markets, the Dow finished the week at another new high of 17810.06, the Euro was at 1.2391 against the Dollar, and nearby crude oil futures were at 76.62 per bbl. Grains settled today with December corn at 3.72-3/4, January soybeans at 10.39, December wheat at 5.47-1/4, and December cotton at 59.76.
At a net total of 25,100 tons, this week’s export sales were a bit lower than noted in the past few weeks. Long grain rough was the big hitter this week at a net of 14,100 tons, consisting of 10,000 tons sold to Costa Rica, 5,000 tons to Mexico, and 2,800 tons to Venezuela.
Long grain milled sales totaled 7,200 tons, mainly to Saudi Arabia (2,100 tons parboiled), Mexico (2,000 tons), Canada (1,200 tons), and Honduras (600 tons). Although not yet officially posted, the big Iraq sale announced yesterday will add to milled numbers over the next few weeks – we needed this. Medium/short grain sales were all in the milled column and totaled 3,800 tons, which included 1,000 tons to South Korea, 600 tons to Canada, 500 tons to Taiwan, and 400 tons to Japan.
Export shipments for the week came in at 70,000 tons, with over half consisting of long grain rough to Venezuela (32,800 tons) and Mexico (3,000 tons). Long grain milled posted 16,000 tons of liftings, with the United Kingdom leading the list at 9,000 tons, along with 2,700 tons to Mexico, 1,100 tons to Guinea-Conakry, and 1,000 tons to Canada. Medium/short shipments were 18,400 tons, which were mainly to Japan (12,000 tons), South Korea (2,900 tons), Jordan (1,400 tons), and Canada (900 tons).