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In This Issue:
- Oil Prices Hover Over World Economy and Farmers
- Missouri Rice Farmers Gather for Annual Meeti
- USRPA Participates in Colombian Rice Webinar
- Washington, D.C. Update
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Oil Prices Hover Over World Economy and Farmers | |
In the US, all eyes are on the cost of inputs. Inflation and increased energy costs were both factors well before Russia invaded Ukraine, and both have been exacerbated by the conflict. Just this week, inflation hit a new record high at 7.9%, and fuel—even red diesel for farm operations—is reaching all time highs. There was cautious optimism only weeks ago that the US long grain rice crop might be able to hold planted acres steady with last year, but that hope is quickly dwindling as input costs rise faster than anytime in recent history. It would not be a stretch to assert that the US long grain crop will drop by another 15% this year. In 2020, planted acres were 2.96 million acres. Last year in 2021, planted acres dropped 17% down to 2.53 million acres. This year, one can expect another 15% decrease, down to 2.15 million acres. This helps explain why long grain prices have found firm-footing despite lagging milled rice exports.
Paddy exports have been strong, which is the norm, but domestic milled business has been the true shining star this year. Milled exports to Haiti have leveled back out after the country imploded months ago and has generated steady millings. Iraq would be a saving grace, but right now the domestic business coupled with a short crop and drought in South America provides enough support to keep prices firm across all growing regions, and even provide some support for new crop pricing, despite it not being in the ground yet.
In South America, Brazil is particularly impacted by the Russia/Ukraine conflict. Brazil imports over 80% of its total fertilizer needs, and almost 100% of its nitrogen fertilizer from Russia. To circumvent the obvious concern and ensure fertilizer supplies for coming crop cycles, the Brazilian government has announced an emergency National Fertilizer Plan in which they intend to be able to produce 40% of their own fertilizers by the year 2050. The problem is, Brazil only produces about 4% of their own nitrogen-based fertilizers currently. This concern is obviously compounded by the drought, and creates an expectation that the harvest of their soybean, corn, sugar, and rice crops will be lighter both in acreage and in yields. This is one more reason that US farmers will cycle out of rice and into soybeans; China’s demand for soybeans doesn’t fade with the acres reduced by drought or yield reduced by unavailable fertilizer.
Breaking News: In an effort to maintain domestic food prices in El Salvador, last night President Nayib Bukele announced the implementation of eleven measures to fight inflation and reduce the economic impact on the people. Among these measures is the supension of import duties from any origin for twenty basic food commodities. www.presidencia.gob.sv
In Asia, Thai prices bumped to over $410pmt this week, again on the fluctuation of the Bhat. In the last three months, Thai prices have increased by 7%. Viet prices are holding steady just over $400 pmt, and in the last three months have fluctuated less than 5%. India and Pakistan tell the same story, only at lower price points around $360 pmt for the past three months and into the current cycle.
The weekly USDA Export Sales report shows Net sales this week of 36,700 MT were down 48% from the previous week and 61% from the prior 4-week average. Increases primarily for Mexico (14,700 MT), Japan (13,300 MT), Nicaragua (5,400 MT), Canada (2,500 MT), and Guatemala (1,500 MT), were offset by reductions for Costa Rica (1,500 MT). Exports of 21,600 MT were down 73% from the previous week and 74% from the prior 4-week average. The destinations were primarily to Haiti (15,300 MT), Canada (3,200 MT), Mexico (2,000 MT), Taiwan (300 MT), and Hong Kong (200 MT).
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Missouri Rice Farmers Gather for Annual Meeting | |
The Missouri Rice Research and Merchandising Council met last night at The Gathering at Versity Crossing in Dexter, Missouri for their 39th Annual Meeting.
David Martin, Missouri Rice Council's Chairman, welcomed approximately 70 farmers and affiliated industry members to the event. Dr. Michael Aide, Agriculture Professor at Southeast Missouri State University and longtime research partner to MRRMC, gave the group an update on the research supported by the Council and discussed the economic impact of rice in Missouri. Introductions of new MRRMC staff included Mollie Buckler, Coordinator for Delta Producer Relations for USRPA and the MRRMC staff liaison; Dr. Justin Chlapecka, Rice Extension Specialist with the University of Missouri; and Michael Johnson, Missouri Rice Research Farm Manager and MRRMC’s latest hire. The group also voted on a bylaw change to allow MRRMC to conduct business virtually if needed. Dinner was catered by the always popular Tasteful Creations.
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The Missouri Rice Research and Merchandising Council met last night at The Gathering at Versity Crossing in Dexter, Missouri for their 39th Annual Meeting. The next generation of rice farmers was well represented at the meeting. Millie and Rowdy Thomas are the children of MRRMC and USRPA board member Mitchell Thomas. | |
USRPA Participates in Colombian Rice Webinar | |
At the invitation of the rice milling organization of Colombia, Marcela Garcia, President & CEO of the USRPA participated in a webinar out of Bogota, Colombia this week titled, “How to Accomplish a Competitive Rice Sector.” Organized by ANDI (National Industries Association) and INDUARROZ, the national rice milling organization of Colombia, the event included participation by the Minister of Agriculture, Rodolfo Zea.
The session was highlighted by the release of a economic study conducted by FEDESAROLLO (Center for Economic & Social Research) and INDUARROZ. The study takes into account that by the year 2030, 39% of Colombia’s rice acreage, number of farmers and rice farm could disappear if competitive measures are not achieved to give new incentives to the sector. Beginning in 2030 the Colombian market will have a zero import duty due to the terms of the Free Trade Agreement with the United States. A copy (in Spanish) of the study can be obtained by contacting the USRPA. Congratulations to Sandra Milena Avellaneda, Director of INDUARROZ, for a well organized and informative webinar.
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On March 9, appropriators finally reached a deal on a $1.5 trillion omnibus appropriations package for FY 2022. In addition to regular appropriations, the package included military and humanitarian aid for Ukraine. Included in the bill is a directive to the Secretary of Agriculture to provide a report outlining how USDA is using existing resources to support agricultural communities to proactively prepare for, recover from, and build long-term resilience to natural disasters. The committee specifically asks that the report include cost estimates for necessary expenses related to replenishing the Wildfire and Hurricane Indemnity Program for crop losses. Both the House and Senate passed this omnibus package which will now be sent to President Biden to be signed into law. Congress will now shift focus to FY 2023 appropriations. President Biden is expected to submit his Budget Request to Congress in the upcoming weeks to provide direction to the Appropriations Committee to set guidance for the upcoming year’s budget. | | |
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Jake Pennington, General Manager of American Rice Growers Association-Anahuac Division, enjoyed a visit this week from Enrique Mendez, principal with Grupo Agroindustrial MYR SA from Mexico City. A buyer of rice brokens and other rice by-products, Enrique has worked with the USRPA for the past 12 years and is a regular participant at the Rice Market & Technology Conference. American Rice Growers-Anahuac are members of the USRPA. | | |
Early Bird Registration Ends Monday, March 14! | | |
Sponsorship & Exhibitor Opportunities Are Selling Fast! | | |
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Reserve Your Stay at the
New Hilton Cancun Resort!
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Food and Ag Regulatory and Policy Roundup | | |
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Rice export prices decreased 2-3 percent due to the weakening of the Thai baht and new supplies of MY2021/22 off-season rice entering the market.
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Grain: World Markets and Trade
This monthly report includes data on U.S. and global trade, production, consumption and stocks, as well as analysis of developments affecting world trade in grains. Covers wheat, rice and coarse grains (corn, barley, sorghum, oats and rye).
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34th Annual Arkansas Agricultural Hall of Fame Induction Luncheon: Embassy Suites, Little Rock, Arkansas – event details and tickets (RESCHEDULED) | |
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. | | | | |
