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In This Issue:
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Market Update - Low Water Levels on the Mississippi River Complicate U.S. Export Outlook
- Washington, D.C. Update
- Mexico’s President Announces Anti-Inflationary Plan Causing Alarm in the Rice Sector
- USRPA Participates At The Rice Education Exhibit At The Texas Rice Festival, Winnie, TX
- Ray Stoesser Memorial Scholarship: Application Available
- Photos from Rice Country
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Market Update - Low Water Levels on the Mississippi River Complicate U.S. Export Outlook
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Drought is not only a California problem; lack of water is plaguing barge traffic on the Mississippi river as well. Low water levels are inhibiting the flow of goods right at the harvest of corn, soybeans, and rice. Tows moving barges has decreased by 31% because of the low water levels, and the current rate of unloading grain barges is 39% below the five-year average. The below-average rainfall is rationing the supply of barges, further increasing costs along the supply chain to deliver a final product to processors and consumers. In a year where inputs have skyrocketed, this climate-induced cost increase is not a welcome complication in the food matrix. The conditions could not come at a worse time and the forecast calls for continued dry weather. Lack of rail availability and with trucks largely booked, “you are going to see people in dire straights” says Lucy Fletcher of AGRIServices of Brunswick.
Harvest in Arkansas is approaching 80% complete, with Mississippi just ahead of them. Missouri is only approaching 60%, which is close to the five-year average. California is only reported to be 30% complete, which is in line with normal but will likely finish more quickly since only half of the state got planted. Late-harvested millings continue to impress, which will help balance out some of the weaker milling yields from the start of harvest. This rings true in CA as well, where the earliest rice was cut in nearly 110-degree weather; the rice cut in this heat will be counted as an outlier by the time the year is finished.
In Asia, prices have remained flat this week despite the expectation that the Indian tariff would put upward pressure on Thai and Viet rice. Perhaps the delay in any increase is a result of India announcing multiple extensions of their tariff and extending the date on which the ban of brokens will kick in. Right now it’s business as usual, despite the ominous expectation of volatility ahead. Thai prices are reported to be $420 pmt this week, Viet $425, and Indian up to $390pmt.
There is a bipartisan bill to expand USDA funding to promote exports that are gaining traction. There is support from both sides of the aisle to put more money in the hands of farm groups, including the rice industry, to double the Market Access Program and Foreign Market Development Program. The thrust of the bill is to be considered part of the farm bill and is needed to expand the presence and sale of US agricultural products. A large reduction in rice exports to Mexico and Central America is the result of high prices caused by strong domestic demand, high production costs, and the smallest rice crop since 1993/94.
The weekly USDA Export Sales report shows net sales of 38,100 MT this week, primarily for Japan (13,000 MT), Canada (9,500 MT), Guatemala (5,000 MT, including decreases of 1,000 MT), Nicaragua (4,400 MT), and Jordan (3,900 MT). Exports of 9,700 MT were primarily to Canada (2,800 MT), Mexico (2,300 MT), Saudi Arabia (1,700 MT), South Korea (1,600 MT), and Austria (700 MT).
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Continuing Resolution Passes
Last week, Congress avoided a government shutdown by passing a continuing resolution before the September 30 deadline. The bill will fund the government at FY22 levels and extend authorizations for programs including the National Flood Insurance Program, Food and Drug Administration user fees, and Temporary Assistance for Needy Families. It also provides supplemental funding, including $12.3 billion for Ukraine, over $20 billion for natural disaster recovery, $1 billion for the Low Income Home Energy Assistance Program, and $20 million for Army Corps water and wastewater infrastructure improvements. The continuing resolution expires on December 16.
Mexico Announces Agreement to Address Inflation
This week, the government of Mexico announced an agreement with 15 private companies to address food price inflation. The Opening Agreement against Inflation and Scarcity pledges to reduce the costs of 24 basic goods, including rice, by 8%. As part of the agreement, the 15 companies are exempted from Mexico’s import requirements for food and food packaging. The agreement extends through February 2023.
Senate Agriculture Committee Leaders Advocate for Crop Protection Tools
This week, Senate Agriculture Committee Chairwoman Debbie Stabenow (D-MI) and Ranking Member John Boozman (R-AR) sent a letter to Department of Agriculture (USDA) Secretary Tom Vilsack and Risk Management Agency (RMA) Administrator Marcia Bunger advocating for the expansion of margin protection tools. In the letter, the Senators cited the increased risk producers face due to elevated input costs. They called for RMA to increase the commodities eligible for RMA insurance policies and improve producer awareness of available programs. The letter can be found here.
House Republicans Voice Concern for Foreign Ownership of U.S. Farmland
In the House, 130 Republican members sent a letter to Comptroller General Gene Dodaro requesting the Government Accountability Office (GAO) review the impacts of foreign investment in U.S. farmland. The letter noted foreign landownership has increased significantly in recent years and cited concerns about the effects this has on national security, trade, and food security. The members of Congress requested GAO conduct a study to assess and improve current measurement practices. The letter can be found here.
Senate Confirms Agricultural Nominees
Last week, the Senate confirmed two agricultural nominees. The Senate approved by voice vote the nominations of Dr. Jose Emilio Esteban for USDA undersecretary for food safety and Vincent Garfield to be on the board of the Farm Credit Administration. The Senate has yet to take up votes for Alexis Taylor, nominee for USDA undersecretary for trade and foreign agricultural affairs, or Doug McKalip, nominee for chief agricultural negotiator at the Office of the U.S. Trade Representative.
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Mexico’s President Announces Anti-Inflationary Plan Causing Alarm in the Rice Sector
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This week in Mexico, President Lopez Obrador announced a new plan along with some 15 food company executives that not only eliminates import tariffs from basically any Origen but exempts sanitary inspections. The Mexican rice trade immediately voiced their concerns about the dangers to the production and supply of rice for farmers and mills in addition to violating commercial agreements and internal economic competition by favoring a few food businesses. Verde Valle is the only rice-related company listed in the government announcement. As of this writing, the announcement and details have yet to be published in Mexico”s Federal Register. The USDA released the following report on Monday of this week.
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USRPA Participates At The Rice Education Exhibit At The Texas Rice Festival, Winnie, TX | The purpose of the Rice Education Exhibit, was to further the influence of the festival's continuing education program. It was a great event to educate youth on all things RICE! Participation in community educational events has allowed USRPA to raise awareness of rice and promote rice consumption and education. | |
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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This week's picture comes from Rice Harvest 2022 at Canon Farm Walnut Lake, Dundee, MS. 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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Grain and Feed Update - China
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USDA Announces October 2022 Lending Rates for Agricultural Producers
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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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