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US RICE PRODUCERS
KATY, TEXAS
The rice market marches along here in the Western Hemisphere. On the ground we have seen a softening in price during the new year, perhaps initial signs of pressure from India creeping into our markets. The real story though, will be what tariffs are announced upon the new Administration taking control of the country and economy next week. Rice is heavily dependent upon exports, and with tariffs being the word of the day, U.S. rice may be caught in the crossfire of geopolitical positioning.
Through most of December, prices in Texas were $15.50-$16.10, but have dropped down to $15.35/cwt in the new year. The story is the same for Louisiana, where prices were in the $15.50/cwt range, now being reported in the $14.50-$14.80/cwt range. Mississippi, Arkansas, and Missouri are all experiencing the same downward pressure, with prices dropping in the new year from $$14.50-$14.75, down to $13.00-$13.50/cwt. The announcement and timing of $70/acre emergency funding from Congress couldn’t come at a better time.
TheWASDE Reportcame out last week, and the outlook for U.S. rice calls for higher supplies, larger domestic use (thankfully!), unchanged exports, and smaller ending stocks. Domestic and residual use increased by 6 million cwt up to 165 million. The final number for US rice production totaled 222 million cwt, up 2% from the previous year. Projected ending stocks are lowered by 3.2 million cwt to 43.5 million. That’s still 9% higher than last year. A disturbing development for rice farmers is that U.S. imports now represent 33% of the domestic consumption, an all-time high according to the recent USDA-ERS Rice Market Outlook report while U.S. 2024/25 total rice imports are projected at a record 46.5 million hundredweight.
The global outlook per the WASDE calls for smaller supplies, smaller consumption, lighter trade, and lower ending stocks. While global supply decreases are marginal, at least we’re not gaining. Contrary to the USDA, our take is that world trade will increase simply on account of India being back in the market, therefore precipitating a drop in prices and more demand.
In Asia, prices haven’t been this low since February of 2023. Surprisingly enough, India isn’t the low-price leader, instead, it’s Vietnam. Right now we are seeing Asian prices crater, with Vietnam at $425pmt, Indian prices at $450pmt, and Thai prices at $465pmt. Thai 100%B is holding a higher price, but only at $480pmt currently.
In South America, the action will be coming out of Uruguay as they are the only country with a significant exportable supply. The poor milling quality coming out of the U.S. is depressing paddy prices FOB NOLA, where we reported prices last week as low as $370 pmt if not lower this week. The export market in the Delta is unusually quiet. With harvest still underway in the Mercosur that is indicating a softer market by the week we know that competition will be fierce in the Western Hemisphere in the coming months.
Theweekly USDA Export Sales reportshows net sales of 23,100 MT this week, up noticeably from the previous week, but down 61% from the prior 4-week average. Exports of 58,300 MT were up significantly from the previous week and up 18% from the prior 4-week average. The destinations were primarily Mexico (26,100 MT), Japan (15,900 MT), Haiti (10,800 MT), Canada (2,400 MT, including 1,200 MT - late), and South Korea (2,400 MT).∆
US RICE PRODUCERS
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