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30th March, 2015 Daily ORYZA Rice E-Newsletter by Riceplus Magazine
30th March, 2015 Daily ORYZA Rice E-Newsletter by Riceplus Magazine
Volume 5, Issue I
Daily Exclusive
ORYZA Rice
Newsletter
Planting for India 2014-15 rabi (secondary) rice crop (November - May) has reached around
3.943 million hectares as of March 27, 2015; down about 9.5% from around 4.355 million
hectares planted during the same period last year, according to preliminary data released by the
Indian Agriculture Ministry.
The decline is reportedly due to untimely rains in some part of the rabi rice growing areas.
The government of India, in its second advance estimates for major crops, has estimated India's
rice production for 2014-15 marketing year (October 2014 - September 2015) at around 103.04
million tons, down about 3% from an estimated 106.65 million tons in 2013-14, according to a
The U.S. cash market was slightly weaker today giving up the gains made yesterday; however,
the price variance is negligible as there is very little trading occurring at the current price level.
Analysts note that plantings are running behind in the U.S. Mid-South as wet weather continues
to be an issue. However, they contend that things are coming along well in Louisiana although
there is talk of a smaller second crop this year.
The IGC estimates 2014-15 world rice production at around 475 million tons, slightly down
from around 476 million tons in 2013-14. It expects Indias rice production to decline about 3
million tons y/y to around 103 million tons. It expects production in Thailand and Pakistan to
decline, while it expects production in the U.S. to increase. It expects marginal increase in South
American production.
It expects world rice consumption in 2014-15 to increase to around 483 million tons, up about
1% from around 479 million tons in 2013-14 and also expects total use to exceed world
production. It expects consumption ton sub-Saharan African countries of Nigeria, Cte dIvoire
and Madagascar to increase 2% y/y to around 26.6 million tons. Demand for high-quality
imported white and parboiled rice is expected to increase.
Therefore, the Council expects world rice ending stocks in 2014-15 to decline to around 101
million tons from around 110 million tons in the previous year. Major declines are expected in
Thailand and India. The IGC expects Thailands stocks to contract by almost a quarter to 9.1
million tons in 2014-15 from an estimated 11.8 million tons in 2013-14 due to excessive sale of
stockpiled rice by the government. Indias stocks are also expected to decline about 23% y/y to
around 16.8 million tons in 2014-15 due to a lower kharif output.
China's Guangdong Grain Association has signed an agreement with the Rice Exporters
Association of Pakistan (REAP) for the import of around 1,500 tons of rice this year, according
to local sources.
A 10-member delegation from China, which is on a visit to Pakistan met with the members of
REAP at the Head Office of the Trade Development Authority of Pakistan (TDAP) on March 25,
2015. The TDAP reportedly arranged for a business-to-business meeting of the two associations.
The REAP has been urging the government to support them in increasing rice exports to China
and tap a significant share in the Chinese market. China imports a huge quantity of rice every
year from Thailand and Vietnam. But exporters say Pakistan rice is also favoured by the Chinese
for its taste. Last year, they TDAP and the Pakistan embassy in Beijing to take up the issue of
increase China's annual rice import limit from Pakistan to around 750,000 tons from around
500,000 tons during the their Prime Minister's visit to China. They noted that the low import
quota is deterring them to increase rice exports to China.
Pakistan exported around 158,351 tons of non-basmati rice to China in the first six months of FY
2014-15 (July - June), according to data from the Rice Exporters Association of Pakistan
(REAP). The South Asian nation exported around 353,242 tons of rice to China in FY 2013-14.
Indian basmati rice could not find its way into the world's largest consumer of rice due to
concerns of it being infested with 'khapra beetle' and lack of proper phyto-sanitary regulations
between the two countries. Now, the government of India is preparing ground to begin exporting
basmati rice to China.
India's National Plant Protection Organization (NPPO) is likely to declare some of the country's
rice-shelling and exporting units registered with it as free from 'khapra beetle' infestation,
according to local sources. The government of India is expected to send a list of credited Indian
rice mills with the infestation-free certification from the NPPO to the Chinese authorities by the
end of June this year, according to the President of Punjab Rice Exporters' Association.
India rice sellers lowered their quotes for 5% broken rice by about $10 per ton to around $375 $385 per ton today. Other Asia rice sellers kept their quotes mostly unchanged today.
Italian paddy quotes are stable. Long B prices remain firm, while Long A and round prices are
slightly lower; the result is a slight reduction in the gap between Indica and Japonica quotations.
Below are farm gate paddy rice quotations supplied by Milan Grain Exchange, as of March 24:
The Cambodian Rice Federation (CRF) has discussed with the EU delegation, which visited
Cambodia to discuss over rice exports under the Everything But Arms (EBA) agreement, over
Italy's concerns on increasing EU rice imports from Cambodia and affecting the competitiveness
of locally produced rice.The CRF told the EU delegation that Cambodia has been focusing on
exporting more of fragrant and jasmine rice to the EU and does not compete with the locally
produced white rice. It also noted that Cambodia will lessen its dependence on EU market and
focus on improving the quality of their rice. It further added that Cambodia's rice exports to EU
so far in 2015 have declined by about 30% compared to same period last year.
The CRF President noted that they do not intend to increase EU share and are stepping up their
efforts to diversify their export market for fragrant rice.
It also noted that the Cambodian rice industry is shifting its focus to high end quality of fragrant
rice than the large quantity low-end long grain white (LGWR). They are also aiming to apply for
a Geographical Indication (GI) tag for Cambodian Jasmine rice.
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Chicago rough rice futures for May delivery are currently seen 14 cents per cwt (about $3 per
ton) lower at $10.970 per cwt (about $242 per ton) during early floor trading in Chicago. The
other grains are seen trading mostly lower: soybeans are currently seen about 0.5% lower, wheat
is listed about 0.2% higher and corn is currently noted about 0.4% lower.
U.S. stocks traded in a narrow range on Friday as equities attempted to break the week's decline
and investors remained cautious ahead of first quarter earnings in April. The Nasdaq held gains
while the Dow and S&P 500 struggled to stay in positive territory. Stocks have not posted gains
for a single day so far this week. Federal Reserve Chair Janet Yellen will speak shortly before
closing bell on Friday. The third estimate for fourth-quarter U.S. gross domestic product (GDP)
came in unchanged at 2.2%. While corporate profits fell, consumer spending was revised higher
to 4.4% from 4.2%, the fastest rate since the first quarter of 2006. Most analysts expected a rise
to 2.4% from 2.2%. However, a few estimates say weak U.S. economic data could result in a
negative revision. The Dow Jones industrial average traded up 15 points, or 0.08%, at 17,960.
The S&P 500 traded up 1.60 points, or 0.08%, at 2,057, with health care leading nine sectors
higher and energy the only laggard. The Nasdaq traded up 8.29 points, or 0.17%, at 4,872. Gold
is currently trading about 0.8% lower, crude oil is seen trading about 3.1% lower, and the U.S.
dollar is currently trading about 0.1% lower at 9:00am Chicago time.
Chicago rough rice futures for May delivery settled 12 cents per cwt (about $3 per ton) lower at
$10.990 per cwt (about $242 per ton). The other grains closed mostly lower, although wheat did
manage to recover a portion of losses sustained yesterday; Soybeans closed about 0.7% lower at
$9.6725 per bushel; wheat finished about 1.7% higher at $5.0775 per bushel, and corn finished
the day about 0.1% lower at $3.9100 per bushel.
U.S. stocks traded mostly higher on Friday as equities attempted to break the last four days of
decline and investors remained cautious ahead of first quarter earnings in April. The U.S. dollar
is up more than 13% in the last six months and has weighed on corporate earnings. The Nasdaq
held gains while the Dow and S&P 500 struggled to stay in positive territory on Friday. Stocks
have not posted gains for a single day so far this week. The last time the S&P posted losses for
every consecutive day from Monday to Friday was in May 2012. The third estimate for fourthquarter U.S. gross domestic product (GDP) came in unchanged at 2.2%. While corporate profits
fell, consumer spending was revised higher to 4.4% from 4.2%, the fastest rate since the first
quarter of 2006. Most analysts expected a rise to 2.4% from 2.2%. However, a few estimates
held that weak U.S. economic data could result in a negative revision. The Dow Jones industrial
average traded up 12 points, or 0.06%, at 17,689. The S&P 500 traded up 3 points, or 0.12%, at
2,058, with health care leading seven sectors higher and energy the greatest laggard. The Nasdaq
traded up 17 points, or 0.35%, at 4,880. Gold is trading about 0.4% lower, crude oil is seen
trading about 5% lower, and the U.S. dollar is seen trading about 0.1% lower at about 2:00pm
Chicago time.
Thursday, there were 343 contracts traded, down from 724 contracts traded on Wednesday. Open
interest the number of contracts outstanding on Thursday decreased by 32 contracts to 8,944.
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Vietnam, world's third largest rice exporter and fifth largest rice producer, is embracing older
rice farming techniques such as floating rice or deep water rice. The concept, which was given
up gradually over the last five decades is again gaining popularity due to the ecological, social
and economic benefits associated with it.Before 1975, floating rice cultivation was very
prevalent in Vietnam's Mekong Delta. It accounted for nearly 500,000 hectares of Vietnam's rice
area. However, it's proportion gradually declined reaching some tens of hectares by 2012.
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