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    Rice Outlook: Season-Average Prices Raised

    The California medium- and short-grain season-average rough-rice price forecast was raised 30 cents on both ends to $19.80-$20.80 per cwt. The U.S. long-grain season-average rough-rice price was also raised 30 cents on both ends, to $12.20-$12.80 per cwt. Both upward revisions were based on reported cash prices and marketings through January and expectations regarding prices the remainder of the market year.

    There were no supply side revisions this month. Total U.S. supplies of rice in 2014/15 remain projected at 275.9 million cwt, 11 percent higher than a year earlier, as a much larger crop more than offsets a smaller carryin and near-steady imports. Total U.S. exports were revised up 1.0 million cwt to 104.0 million cwt, with long-grain milled rice accounting for all of the increase. The higher export forecast lowered the 2014/15 all rice ending stocks forecast to 40.9 million cwt, still 28 percent above a year earlier.

    Domestic Outlook

    Total U.S. 2014/15 Rice Supplies Projected To Increase 11 Percent to 275.9 Million Cwt

    There were no supply side revisions this month. Total U.S. supplies of rice in 2014/15 remain projected at 275.9 million cwt, 11 percent higher than a year earlier and the largest total U.S. rice supplies since the 2010/11 record. In 2014/15, a much larger crop more than offsets a smaller carryin and near-steady imports. Long-grain supplies remain projected at 198.1 million cwt, 14 percent above a year earlier. Medium- and short-grain total supplies in 2014/15 remain projected at 75.5 million cwt, 2 percent above a year earlier, mostly due to a larger carryin.

    All-rice beginning stocks for 2014/15 remain estimated at 31.8 million cwt, 13 percent below a year earlier. The 2014/15 long-grain carryin remains estimated at 16.2 million cwt, 26 percent smaller than a year earlier. The medium- and short-grain carryin remains estimated 13.3 million cwt, 9 percent larger than a year earlier. Stocks of brokens, included in estimates of total supply and total stocks, are not included in supplies or stocks by class.

    Imports remain projected at 23.0 million cwt, nearly unchanged from a year earlier. Long-grain 2014/15 imports remain projected at 19.5 million cwt, also virtually unchanged from the year-earlier record. Thailand is expected to again supply more than 70 percent of U.S. long-grain imports, shipping mostly its premium jasmine rice, an aromatic.

    Basmati rice from India and Pakistan accounts for much of the remaining U.S. long-grain rice imports. Medium- and short-grain imports remain projected at 3.5 million cwt, also nearly unchanged from 2013/14. Similarly to 2013/14, the U.S. has imported brokens from Australia, taking about 21,000 tons in December 2014 compared with about 28,000 tons in November 2013. Australia is a major exporter of medium- and short-grain rice.

    The 2014/15 U.S. rice crop remains estimated at 221.0 million cwt (hundredweight, rough basis), 16 percent above a year earlier. The bumper crop is the result of an 18-percent increase in harvested area to 2.92 million acres. The average U.S. yield of 7,572 pounds per acre is 122 pounds below a year earlier but still the second highest on record.

    By class, 2014/15 long-grain production remains estimated at 162.4 million cwt, 23 percent above a year earlier. Combined medium- and short-grain production remains estimated at 58.7 million cwt, 1-percent larger than a year earlier. A 4-percent expansion in harvested area to 727,000 acres more than offset a 2-percent decline in the medium- and short-grain average yield to 8,068 pounds per acre.

    This year, a larger than normal share of the U.S. medium- and short-grain crop came from the South, a major factor behind the lower average yield.

    U.S. 2014/15 Long-grain Export Forecast Raised 1.0 Million Cwt to 72.0 Million Cwt

    Total use of U.S. rice in 2014/15 is projected at 235.0 million cwt, up 1.0 million cwt from last month’s forecast and 8 percent larger than a year earlier. Both total domestic use (including a residual component) and exports are projected to be larger in 2014/15 than a year earlier. Total long-grain use in 2014/15 is projected at 171.0 million cwt, up 1.0 million cwt from last month’s forecast and 9 percent larger than a year earlier. Combined medium- and short-grain rice total use remains projected at 64.0 million cwt, 6 percent higher than a year earlier.

    Total domestic and residual use of all rice in 2014/15 remains projected at 131.0 million cwt, 5 percent larger than a year earlier and the second highest on record. The higher domestic and residual use forecast for 2014/15 is mainly based on the larger crop. Long-grain domestic and residual use remains projected at 99.0 million cwt, 4 percent above a year earlier. Combined medium- and short-grain domestic and residual use remains forecast at 32.0 million cwt, 8 percent larger than a year earlier.

    Total exports in 2014/15 are projected at 104.0 million cwt, up 1.0 million cwt from last month’s forecast and 12 percent larger than a year earlier. This month’s upward revision was based on stronger than expected sales to Latin America, the largest market for U.S. rice. The year-to-year increase in U.S. exports projected for 2014/15 is largely based on expectations that more competitive U.S. prices will increase sales to major markets in Latin America and the Middle East.

    U.S. 2014/15 long-grain exports are projected at 72.0 million cwt, up 1.0 million from last month’s forecast and 16.5 percent above a year earlier. Through late February, U.S. exports and outstanding sales were ahead of a year earlier to the Caribbean, Central America, and South America, with Colombia, Haiti, and Venezuela accounting for most of the year-to-year increase.

    The Western Hemisphere is the largest export market for U.S. long-grain rice, typically accounting for two-thirds of U.S. long-grain shipments, with rough rice accounting for the bulk of U.S. shipments to the Western Hemisphere. The major Asian rice exporters do not ship rough rice out of the region and ship milled rice mostly within Asia and to Africa and the Middle East. The Middle East, Canada, and Sub-Saharan Africa are the next largest markets for U.S. long-grain rice, taking almost exclusively milled-rice from the United States. The U.S. typically faces its strongest competition with Asian exporters in the Middle East and Sub-Saharan Africa.

    Combined medium- and short-grain U.S. exports in 2014/15 remain projected at 32.0 million cwt, 7 percent larger than a year earlier. Northeast Asia and the Middle East (including North Africa) account for the bulk of U.S. medium- and short-grain exports, with Northeast Asia–Japan, South Korea, and Taiwan– typically taking almost two-thirds of total U.S. medium- and short-grain exports.

    These annual Northeast Asia sales typically begin in late September and are all the result of agreements under the World Trade Organization. Although U.S. shipments to this region are still behind a year earlier, there have been several large purchases–especially by Japan–over the past month that have yet to ship. Except for Northeast Asia, there have been few sales of U.S. medium- and short-grain rice over the past month.

    By type, U.S. rough-rice exports remain projected at 35.0 million cwt, up 22 percent from a year earlier. Through February 26, U.S. commercial sales and shipments of rough-rice were ahead of a year earlier to Colombia, Turkey, and Venezuela. In contrast, rough-rice shipments and outstanding sales to Mexico–the largest market for U.S. rough-rice–were 14 percent behind a year earlier for the week ending February 26. Long-grain accounts for the bulk of U.S. rough-rice exports, with

    Latin America the top regional market. Southern long-grain accounts for nearly all of the U.S. rough-rice shipments to Latin America. Turkey and Libya account for almost all U.S. medium- and short-grain rough-rice exports.

    Combined milled- and brown-rice exports (on a rough basis) are projected at 69.0 million cwt, up 1.0 million cwt from last month’s forecast and 8 percent larger than a year earlier. Through February 26, combined U.S. exports and sales of milled rice were ahead of a year earlier to the Caribbean, South America, Mexico, and Northeast Asia; but behind last year’s pace to Turkey and Sub-Saharan Africa. The expected increase in 2014/15 in U.S. milled-rice exports is based on lower U.S. prices, a much smaller U.S. price difference over Asian competitors, and larger U.S. supplies.

    Through February 26, combined commercial exports and outstanding sales of all rice reported in the weekly U.S. Export Sales totaled 2.46 million tons (productweight), 7 percent larger than a year earlier. Commercial exports were 1 percent higher than a year earlier, while outstanding commercial sales were 18 percent ahead of a year earlier. There were substantial differences in sales and shipments by class and type.

    At 931,100 tons, U.S. long-grain rough-rice outstanding commercial sales and shipments were 17 percent ahead of a year earlier for the week ending February 26, with shipments 18-percent ahead and outstanding sales 1-percent ahead. Venezuela accounts for most of the year-to-year increase. In contrast, commercial shipments and sales of long-grain rough-rice to Mexico were 14 percent behind a year earlier.

    Medium- and short-grain U.S. rough-rice exports and outstanding sales of 210,500 tons were 2 percent ahead of a year earlier for the week ending February 26. Sales of medium- and short-grain rough-rice have been quite small since late December; shipments have been light since mid-January. Turkey is the largest buyer of U.S. medium- and short-grain rough-rice and accounts for nearly all of this year’s stronger pace.

    Long-grain milled-rice commercial exports and sales totaled 729,400 tons for the week ending February 26 and were up 18 percent from a year earlier. Combined sales and shipments were ahead of a year earlier to Iraq, Colombia, Haiti, and Sub- Saharan Africa. In contrast, medium- and short-grain milled-rice exports and outstanding sales of 548,500 tons were 9 percent behind a year earlier for the week ending February 26; shipments were 47 percent behind last year’s pace, but outstanding sales were 26 percent ahead. Commercial sales and shipments of medium- and short-grain milled rice were behind a year earlier to the Mediterranean, but were ahead to Northeast Asia after lagging most of the market year.

    U.S. ending stocks of all rice in 2014/15 are projected at 40.9 million cwt, down 1.0 million cwt from the previous forecast but still 28 percent larger than a year earlier. The stocks-to-use ratio is estimated at 17.4 percent, up from 14.6 percent in 2013/14.

    By class, the 2014/15 U.S. long-grain carryout is projected at 27.1 million cwt, down 1.0 million cwt from last month’s forecast but 67 percent larger than a year earlier and the highest since 2010/11. The long-grain stocks-to-use ratio is estimated at 16.5 percent, up from 10.3 percent in 2013/14. The medium- and short-grain carryout remains projected at 11.5 million cwt, 14 percent smaller than a year earlier. The medium- and short-grain stocks-to-use ratio remains estimated at 17.9 percent, down from 22.0 percent in 2013/14.

    U.S. 2014/15 Season-Average Farm Price Forecasts Raised for both Classes of Rice

    The combined medium- and short-grain 2014/15 U.S. season-average farm price (SAFP) range is projected at $18.10-$18.90 per cwt, up 20 cents on both the low end and high end of last month’s range. The midpoint of the 2014/15 medium- and short-grain SAFP–$18.50 per cwt–is up 20 cents from the previous month’s midpoint but 70 cents below the 2013/14 SAFP of $19.20 per cwt.

    The upward revision was based on monthly reported cash prices and marketings through January and expectations regarding prices and marketings the remainder of the market year. By region, the California 2014/15 medium- and short-grain SAFP is forecast at $19.80-$20.80 per cwt, up 30 cents on both the low and high end of last month’s forecast, with the mid-point 40 cents below $20.70 a year earlier.

    In 2014/15, California growers are facing greater competition from southern medium grain, which is priced well below rice from California. For the Other States, the 2014/15 medium- and short-grain SAFP is projected at $14.80-$15.40 per cwt, unchanged from last month but down from $15.70 a year earlier. In 2014/15, southern medium- and short-grain area expanded 110 percent from 2013/14, largely a response to a 24-percent reduction in California plantings.

    The 2014/15 SAFP range for U.S. long-grain rice is projected at $12.20-$12.80 per cwt, up 30 cents on both the low and high end of last month’s forecast. The midpoint of the 2014/15 long-grain SAFP of $12.50 per cwt is well below the 2013/14 SAFP of $15.40 per cwt and is the lowest long-grain SAFP since 2010/11.

    The expected price decline in 2014/15 is primarily based on larger U.S. supplies, weaker prices for other agricultural commodities, lower global trading prices, and a stronger U.S. dollar. The 2014/15 all-rice U.S. SAFP was raised 30 cents on both the high and low end to $14.00-$14.60 per cwt due to higher SAFP forecasts for long-grain and medium- and short-grain rice. This is well below the $16.30 reported for 2013/14.

    In late February, NASS reported a January U.S. long-grain rough-rice cash price of $12.50 per cwt, up 10 cents from December and the first increase since June. Since the start of the 2014/15 market year in August, long-grain cash prices have dropped $1.80 per cwt. Virtually all U.S. long-grain rice is grown in the South. For U.S. combined medium- and short-grain rice, the January NASS price was reported at $19.00 per cwt, up 80 cents from the December price.

    By region, the California January medium- and short-grain rough-rice price was estimated at $21.00 per cwt, up $1.20 from a month earlier but down 90 cents from the start of the California market year in October. The January 2015 Southern medium- and short-grain rough-rice price is estimated at $15.10 per cwt, down 10 cents from December and 50 cents below the August price.

    Full report.




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