THE Philippines, the world’s second-biggest buyer of rice, may import a record 3.2 million metric tons (MMT) this year, driven by higher-than-expected purchases abroad, the United States Department of Agriculture (USDA) said.
In its monthly global grains situation report, the USDA revised upward its rice import forecast for the Philippines in 2022 by 100,000 MT from an earlier estimate of 3.1 MMT.
Based on its latest projections, the USDA said the Philippines’s total rice imports this year would be 8.47 percent higher than last year’s 2.95 MMT recorded import volume.
The USDA explained that it revised upwards its rice import projection for the Philippines because of the “strong” pace of imports this year.
The Philippines’s rice imports from January to July rose by 62 percent to 2.325 MMT from last year’s 1.432 MMT, based on latest data released by the Bureau of Plant Industry (BPI).
BPI data showed that 81.72 percent or about 1.9 MMT of the rice imported during the 7-month period came from Vietnam.
BPI data also showed that it issued 448 sanitary and phytosanitary import clearances (SPS-ICs) to 47 eligible rice importers with a total corresponding import volume of 625,743.6 MT. The 448 SPS-ICs were all issued by BPI in June.
The USDA kept its local rice production projection for the Philippines at 12.6 MMT, or 1.44 percent higher than last year’s 12.42 MMT.
Per USDA data, total area planted with rice this year would reach 4.8 million hectares, slightly higher than last year’s 4.76 million hectares. The Philippines’s average rice yield is projected to inch up to 4.17 MT per hectare from 4.14 MT per hectare, based on USDA data.
The Philippine Statistics Authority (PSA) earlier reported that the country’s total rice inventory as of June declined by 12.3 percent to 2.22 MMT from last year’s 2.53 MMT.
The PSA said about 47.3 percent or some 1.049 MMT of rice were stored by households while 44.8 percent or 995,230 MT were held by commercial entities (warehouses, wholesalers and retailers). The PSA added that rice stocks in the National Food Authority (NFA) warehouses as of June 1 reached 175,490 MT, accounting for 7.9 percent of total inventory during the reference period.
“Rice stocks inventory in all sectors decreased compared with their levels in the previous year. Stocks in the households dropped by -7.3 percent, in commercial warehouses/wholesalers/retailers by -15.2 percent, and in NFA depositories by -22.0 percent,” it said.
By Dwight Roberts, U.S. Rice Producers Association
The market continues to plod along, but this week with a shot in the arm from the USDA planted acres and rice stocks reports. As all expected, acres were down from last year, registering in this report total drop of 189,000 acres, split 70,000 acres of long grain and 106,000 acres of medium grain.
This is perhaps less than some were expecting, so at this point we will keep an eye on weather to determine how much of the planted crop makes it to a healthy harvest. To that point, higher than normal temperatures in Texas are stressing the rice crop already, causing crop experts to warn of lower yields. The triple digit temps on the backs of a drought are not boding well for a strong crop at this point.
The Stocks report paints a decent picture — one that helps support the higher paddy prices that have been sustained on the ground. Total rice stocks were reported down 10% from this time last year; long grain rough down 11%, long grain milled down 5.5%. Crop Progress is right on track, except in California where cool weather during planting has all but stunted the rice plants, slowing their growth to maturity. And while Texas is experiencing dangerously high temps, cooler weather patterns in Arkansas and Louisiana bode well for harvest.
A recent GAIN report on Mexico published this week shows an increase in expected production in the region, up to 291,000 MT (rough), which is up 6.2% or 17,000 MT over USDA’s original estimate of 274,000 MT. This equates to approximately 200,000 MT of milled rice, correspondingly up from the 188,000 MT estimate. The increase is a result of increased plantings, and a higher yield projection, however local sources temper this expectation with concerns about water availability in Campeche to finish the crop.
In Asia, Thai prices dropped again, down to $410 pmt from $420 pmt las week. This is coming much more in line with the prices from three months ago before Iraq stepped in and tightened supply up a bit. Vietnam held constant at $420 pmt, as did India at $350 pmt.
The weekly USDA Export Sales report shows net sales of 17,500 MT, down 13% from last week’s dismal report, and 45% from the prior 4-week average. Exports of 45,800 MT were down 13% from the previous week and 25% from the prior 4-week average. The destinations were primarily to Haiti (15,100 MT), Japan (12,000 MT), Honduras (8,800 MT), Canada (3,400 MT), and South Korea (2,700 MT).
Prices for long grain milled are priced at or just above $650 pmt, whereas prices in South America are at least $100 pmt below that. South America is in the peak of their harvest season, with several questions swirling around the drought situation in Brazil. We know that Uruguay has crested the high point, and is on the downhill slope of the last 20% of their crop. Argentina is just ahead of them. Brazil and Paraguay are the big swings that will be coming to light in the next few weeks.
In Asia, prices have held steady despite the inflationary rise that so many other commodities have seen. For more than a quarter now, prices in Thailand and Vietnam have oscillated around $400 pmt, while India and Pakistan have been around $360 pmt. This can in large part be attributed to India, who hasn’t slowed exports over the COVID-19 pandemic, and has been responsible for its third record crop in as many years.
India’s farm subsidies, which many speculate have led to their record crop, has blunted the inflationary impacts of rice world-wide. With rice being the most basic food calorie for human consumption that prevents hunger for the poorest nations, this can be viewed as a positive in the global environment. However, India’s rice subsidy violations have put a burden on many rice producers around the globe; these violations were front-and-center this week with the World Trade Organization (WTO).
India has been called out by the U.S. rice industry and others to stop creating an unfair playing field with their rice subsidy program. It is making rice from the United States and other origins uncompetitive on a global scale, and can have severe detrimental impacts on food security world-wide in the future.
Prices on the ground show Texas in the lead at $17/cwt. Louisiana is strong at $15.25/cwt, while prices in Mississippi, Arkansas, and Missouri are fluctuation between $14.75-$15.75 based on variety and qualities.
The weekly USDA Export Sales report shows net sales of 8,300 MT this week, a marketing-year low, down 51% from the previous week and 81% from the prior 4-week average. Increases primarily for Mexico (13,700 MT), Haiti (7,300 MT), Jordan (4,000 MT), the Dominican Republic (2,000 MT), and Honduras (1,500 MT), were offset by reductions primarily for Colombia (22,000 MT).
Exports of 80,300 MT were up noticeably from the previous week and up 98% from the prior 4-week average. The destinations were primarily to Mexico (32,700 MT), Colombia (22,300 MT), Haiti (15,300 MT), El Salvador (4,100 MT), and Canada (2,000 MT).In the futures market, May 22 prices are down just over 1% this week to $16.010. May 23 contracts are about flat from last week, now at $16.615. Average Daily Volume registers at 411, down 23% from last week, while open interest is flat at 9,701.
Iraq Makes First Purchase of U.S. Rice under the U.S.-Iraq Memorandum of Understanding
May 19, 2017 - by Eric Schroeder
The USDA said Cambodia’s rice millers have shifted their attention to the expanding Chinese market in light of new rules in the European Union that have tightened the residue limit of tricyclazole on rice. Cambodian rice farmers commonly use tricyclazole to control rice blast fungus, but effective June 2017 the E.U. said it will implement a new threshold of tricyclazole residue for white rice — 0.01 mg per kg of paddy — and in December 2017 will implement a new tricyclazole residue level for fragrant rice — at 0.01 mg per kg.
“Amid rice millers’ concern of the E.U.’s potential ban on Cambodian rice that fails to meet the chemical residue threshold, the government of Cambodia is looking into substitute options and raising awareness of farmers on proper usage of fungicides,” the USDA said.
Cambodia exported a total of 542,144 tonnes of milled rice in 2016, up 0.7% from 2015. China was the largest destination, importing 127,460 tonnes, a figure that is forecast to grow to 200,000 in 2017, the USDA said. The increase in demand from China is expected to outpace the potential decline in demand from traditional E.U. buyers.
“Last December, China National Cereals, Oils, and Foodstuffs Corporation (COFCO) approved 18 Cambodian rice millers for exporting rice to China as part of an agreement signed between COFCO and the Cambodia Rice Federation (CRF),” the USDA said. “Additionally, the Ministry of Agriculture Fisheries and Forestry (MAFF) selected 28 rice millers who have demonstrated competence to meet the requirements for exporting rice into China. The CRF is urging the government to facilitate more access to the China market to offset potential decrease demand from E.U.
“The cross border rice trade is a vital pathway for Cambodia rice export into Thailand and Vietnam. However, Thailand’s reduction in stock and a production recovery this year show no signs of an increase in import demand. Meanwhile, the cross border trade with Vietnam is robust mostly because of strong demand for Cambodian rice to serve local Vietnamese consumers who prefer quality fragrant rice.”
Overall milled rice exports are forecast to increase 5% to 570,000 tonnes in 2017, and 8% to 615,000 tonnes in 2018, the USDA said.
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