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In This Issue:
- Market Update - Challenges Abound to Market New Crop Rice, Cover Production Costs
- Washington, D.C. Update
- Texas Rice Council Holds Board Meeting
- Ray Stoesser Memorial Scholarship: Application Available
- Photos from Rice Country
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Market Update - Challenges Abound to Market New Crop Rice, Cover Production Costs | |
With harvest now almost complete, the long grain industry finds itself on a precipice and is not entirely sure where to go next. Paddy prices remain firm, but the spot market is not as active as most producers expected it to be post-harvest. That’s because the largest milled market for U.S. rice is getting worse with each passing day, as it’s nearly impossible to unload a vessel in Haiti right now—even for NGOs trying to help the people in crisis. If we look at paddy exports as a bright spot, the U.S. continues to lose market share in Mexico to other origins from South America, namely Brazil. The 80,000 metric tons of Iraq business that has been keeping mills busy was for old crops, and the milling is winding down. The domestic market has been the steady savior, but with both Haiti and Iraq in the wings and prices that are significantly higher than the competition, it will be an interesting year marketing this crop.
After considerable delay and debate in Mexico, the federal government published details of their recent Anti-Inflationary Program that has been reported previously in the Rice Advocate. However, it remains unclear as to the treatment for rice and in the meantime, the length decree (link below) is being interpreted as no real change. Any Mexican company with importing history can access the license while the duty exemption is valid only for paddy rice. The Mexican federal government decree that exempts the payment of import tariff and administrative facilities are granted to various goods of the basic basket and supplies that are indicated. The decree can be found here. A new USDA Gain report on the decree is forthcoming.
These are the factors that don’t even take into account the rising value of the dollar making U.S. exports more expensive, which further depresses our ability to be price competitive with our Western Hemisphere counterparts. Trade is not a focus of the current White House Administration, therefore significant headwinds prevail in developing new markets and sustaining existing ones.
On the ground, Texas prices are holding firm at $17/$18, however with limited activity. The same goes for Louisiana where prices are at $17. Mississippi, Arkansas, and Missouri are all competing for barge space that is limited by low water on the Mississippi River, with prices at $16/$17.
In Asia, the market is holding steady as well. It continues to be an anomaly that rice prices have not experienced the same wild volatility that most other food grains have. Thai 100% B is quoted anywhere from $415-$425 pmt this week, right in line with previous weeks. Vietnamese 5% is pegged at $430 pmt, which is also in line. India remains at $380 pmt, which has been the “new” price since making their tariff announcement.
The weekly USDA export sales report shows net sales of 11,200 mt this week, down 13% to Colombia (10,400 MT), Canada (400 MT, including decreases of 200 MT), Mexico (200 MT), the Netherlands (100 MT), and Micronesia (100 MT). Exports of 7,100 MT were dismal as well, down 87% and headed primarily to Canada (2,400 MT), Mexico (1,900 MT), Jordan (1,000 MT), the United Kingdom (900 MT), and Saudi Arabia (500 MT).
The futures market was active this week, with average daily volume jumping 16% up to 1,448. Open Interest also bumped 4.22% up to 8,289.
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Senators Send EPA Letter on RFS
On Wednesday, a bipartisan group of senators sent Environmental Protection Agency (EPA) Administrator Michael Regan a letter requesting EPA establish robustly and expanded blending volume obligations in its forthcoming “set” rule under the Renewable Fuel Standard (RFS). The letter argues increasing biofuel blends will support both domestic producers and the environment. The senators also called for EPA to take additional supportive action to increase regulatory certainty and opportunities for biofuel producers. The letter can be found here.
USAID Responds to Crisis in Haiti
This week, the U.S. Agency for International Development (USAID) deployed a Disaster Assistance Response Team to Haiti to respond to the humanitarian crisis brought on by political instability. Unrest has led to a month-long nationwide port blockade preventing food and fuel from being imported into the country. Haiti, one of the largest foreign markets for U.S. rice, has not received a shipment of US rice since late August. Earlier this month, Sen. Bill Cassidy (R-LA) penned an op-ed noting the importance of the Haitian market for rice producers and calling for the deployment of the Inter-American Peace Force in Haiti. The United Nations estimates that 4.7 million Haitians are currently facing acute hunger.
USDA Provides $800 Million to Distressed Borrowers
On Tuesday, the Department of Agriculture (USDA) announced it has provided $800 million in debt relief payments to distressed borrowers of Farm Service Agency loans. This amount is part of a total of $3.1 billion allocated through the Inflation Reduction Act (IRA) for assistance to agricultural producers. USDA estimates this assistance will benefit approximately 35,000 borrowers.
Senate Agriculture Committee Plans for Farm Bill Hearings
Senate Agriculture Committee Chairwoman Debbie Stabenow (D-MI) announced her plan to hold multiple farm bill hearings before the end of this year. Sen. Stabenow has stated the upcoming hearings would include different farm bill titles but declined to discuss exact details. The Committee has held two listening sessions on farm bill issues this year, one in Michigan and the other in Arkansas.
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Texas Rice Council Board Meeting
The Texas Rice Council held a board of directors meeting on October 7th, at Midway Bar-B-Q, in Katy, Texas. The Rice Council is entrusted with the producer’s check-off dollars earmarked for promotion, education, and market development. Leaders from Academia, Government, and the U.S. Rice Industry spoke on topics essential to bettering the Texas Rice Industry.
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The new Directors of AgriLife Research and Extension discuss how to improve outcomes from research dollars, and better communication of those outcomes to producers.
Left to right: Dan Hunter, Assistant Commissioner for TDA; Dr. Rick Avery, Director of AgriLife Extension; Dr. Cliff Lamb, Director of AgriLife Research, and Galen Franz, Chairman TRRF.
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Dan Hunter discussed current agricultural affairs, legislative matters, and marketing opportunities with the Texas Rice Council.
Picture: Dan Hunter, Assistant Commissioner for TDA
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Dr. Tim Walker discussed trends in U.S. Long Grain production and marketing over the last twenty years. He gave his perspective on what the U.S. Rice Industry needs to do to regain market share in Western Hemisphere markets traditionally dominated by U.S. Long Grain rice. He also discussed opportunities in the domestic aromatic market.
Left to right: Tommy Turner, President of Texas Rice Council; Dr. Tim Walker, CEO of Horizon Ag; and Marcela Garcia, President & CEO of USRPA.
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Second Annual Ray Stoesser Memorial Scholarship | |
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This scholarship could be yours! Don’t miss out on this great opportunity!
Applications are due Thursday, December 1.
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Throwback picture from August 2022 from farmer Chris Slemp @pinoakfarms, El Campo Texas. Send us your harvest photos on Facebook, Instagram, or via email! | | |
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Food and Ag Regulatory and Policy Roundup | | |
World Agricultural Production | | |
Grain: World Markets and Trade | | |
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Strife In Haiti Halts Once Prosperous U.S. Rice Trade
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India Rice Export Curbs to Trigger Rally in Global Prices After More Than a Decade of Stability
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FAO Rice Price Update - October 2022
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October 20 - 23, 2022
The 85th International Rice Festival
Crowley, Louisiana
More Information
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January 18, 2023
Western Rice Belt Conference
El Campo Civic Center, El Campo, Texas
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January 31 - February 1, 2023
26th Annual National Conservation Systems Cotton & Rice Conference
Baton Rouge, Louisiana
More Information
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USRPA does not discriminate in its programs on the basis of race, color, national origin, gender identity, sexual orientation, religion, age, disability, political beliefs, or marital/family status. Persons who require alternative means for communication of information (such as Braille, large print, sign language interpreter or translation) should contact USRPA at 713-974-7423. |
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