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Lower Yield Results In Global Harvest Drop
Global rice production for 2015/16 is projected at 475.8 million tons (milled basis), down 2.9 million tons from last month’s forecast and almost 1 percent below the year-earlier record.
The smaller global crop is due to a lower average yield, with adverse weather the main factor behind weaker yields. In contrast, global rice area is projected to increase 0.4 million hectares from 2014/15 to 160.5 million, still below the 2013/14 record of 161.5 million hectares.
Production forecasts were lowered this month for several countries, with Southeast Asia accounting for the largest share of the reduction. There were three crop reductions in Southeast Asia this month. First, Burma’s 2015/16 production forecast was lowered 600,000 tons to 12.2 million tons due to a 230,000-hectare drop in area to 6.8 million hectares.
Second, the Philippines’ 2015/16 production forecast was lowered 0.4 million tons to 12.0 million tons due to lower area this summer reported by the Government. Third, Indonesia’s 2015/16 production forecast was lowered 0.35 million tons to 36.3 million based on lower yields.
In nearby East Asia, China’s 2015/16 production forecast was lowered 0.5 million tons to145.5 million tons, based in part on official data from the Government of China.
In North Africa, Egypt’s 2015/16 production forecast was lowered 600,000 tons to 4.0 million tons due to excessive heat that reduced expected yields.
The Western Hemisphere accounted for the remaining 2015/16 decreases in production. The U.S. 2015/16 production forecast was lowered 493,000 tons to 6.02 million based on smaller area and a weaker yield reported by the U.S. Department of Agriculture. U.S. rice production is 15 percent below a year earlier.
These downward revisions were slightly offset by three small upward revisions. First, Australia’s 2015/16 production forecast was raised 45,000 tons to 470,000 tons due to a higher yield. Second, Chile’s 2015/16 production forecast was raised 18,000 tons to a record 110,000 tons based on a much higher yield reported by the Government. Finally, the European Union’s 2015/16 production forecast was raised 10,000 tons to 1.93 million based on larger crops in Spain and France.
The 2014/15 global production estimate was raised 2.3 million tons to 478.6 million tons, fractionally above the previous forecast and the highest on record. There was only one major 2014/15 crop revision this month. India’s 2014/15 production forecast was raised 2.3 million tons to 104.8 million tons based on a higher yield reported by the Government of India.
Global consumption and residual use is projected at 487.4 million cwt in 2015/16, down 0.4 million tons from the previous forecast but up almost 1 percent from a year earlier and the highest on record. Consumption forecasts were lowered this month for Burma and the United States. China accounts for more than half the projected increase in global rice consumption in 2015/16.
With consumption projected to exceed production for the third consecutive year, global ending stocks in 2015/16 are projected to decline 11.7 million tons to 90.2 million, 0.3 million below last month’s forecast and the lowest since 2007/08. Ending stocks forecasts were lowered for Burma, China, Egypt, Indonesia, the Philippines, and the United States; but were raised for India and Vietnam. The stocks-to-use ratio is forecast at 18.5 percent, down from 21.0 percent a year earlier.
Export Forecasts for 2016 Lowered for Burma and the United States; Raised for India
Global rice trade in calendar year 2016 is projected at 42.2 million tons (milled basis), down barely 0.1 million tons from last month’s forecast and 0.2 million tons below this year’s trade. Global trade in 2016 is the third largest on record.
There were several nearly offsetting 2016 export revisions this month. Two were significant downward revisions. First, Burma’s 2016 export forecast was lowered 0.4 million tons to 1.8 million tons based on a smaller crop. Second, the U.S. 2016 export forecast was reduced 200,000 tons to 3.25 million tons due to a much smaller crop. U.S. exports in 2015/16 are 3 percent below the year-earlier revised level.
These two downward revisions were partially offset by two increases. First, India’s 2016 export forecast was raised 0.5 million tons to 9.5 million based on larger supplies. Second, Australia’s 2016 exports were raised 30,000 tons to 330,000 tons based on a larger crop.
There were only two 2016 import revisions this month. First, Indonesia’s 2016 import forecast was raised 200,000 tons to 1.3 million tons due to a smaller crop. Second, Chile’s 2016 import forecast was lowered 20,000 tons to 120,000 tons due to a larger crop.
Global trade in 2015 is projected at 42.5 million tons, nearly unchanged from last month’s forecast and 0.9 million tons below the year-earlier record.
There were three significant export revisions for 2015. First, India’s 2015 exports were raised 0.5 million tons to a record 11.5 million tons based on shipment pace to date and larger supplies.
Asia’s Export Prices Continue To Drop; U.S. Long-Grain Prices Rise
Prices for high and medium grades of Thailand’s regular-milled white rice have decreased around 4 percent from a month earlier, largely due to a weaker baht, continued sales of Government stocks, and a lack of new export sales. Prices for Thailand's high-quality, 100-percent Grade B (free-on-board (fob) vessel, Bangkok) milled rice for export were quoted at $370 per ton for the week ending September 7, down $16 from the week ending August 10 and the lowest January 2008.
Prices for Thailand’s A-1 Super 100-percent brokens for the week ending September 7 were quoted at $319 per ton, down $5 from August 10. In addition, price quotes for Thailand’s premium jasmine rice, an aromatic variety, were quoted at $848 per ton for the week ending September 7, down $16 from the week ending August 10.
Price quotes from Vietnam have declined over the past month as well, also due to currency devaluation and a lack of new sales. For the week ending September 8, prices for Vietnam’s double-water-polished milled-rice with 5-percent broken kernels were quoted at $325 per ton, down $20 from the week ending August 11. Vietnam’s prices are $33 below price quotes for similar grades of Thailand’s rice, down a few dollars from early August, making Vietnam the low cost supplier among the top Asian exporting countries.
In contrast to Asia, U.S. prices for long-grain milled-rice have increased over the past month, largely a response to expectations of smaller supplies in 2015/16. For the week ending September 8, prices for high-quality U.S. Southern long-grain rice (No. 2, 4-percent brokens, bagged, free alongside vessel, U.S. Gulfport) were quoted at $535 per ton, up $44 from the week ending August 11 and the highest since October 2014.
Price quotes for package-quality California medium-grain milled-rice (bulk) for domestic sales to processors and repackagers are unchanged from late May. For the week ending September 8, prices remain quoted at $849 per ton. ∆
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