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Yield Forecast Drops Due To Acreage Reduction
The 2017/18 U.S. rice production forecast was lowered 6.7 million cwt to 179.7 million cwt, 20 percent smaller than a year earlier and the smallest since 1996/97. The average yield of 7,504 pounds per acre is just 9 pounds below the previous forecast, but 267 pounds above the adverse-weather-impacted 2016/17 yield.
By class, the 2017/18 U.S. long-grain crop forecast was lowered 5.3 million cwt to 127.1 million cwt, 24 percent below a year earlier and the lowest since 2011/12. The 2017/18 U.S. medium- and short-grain crop is forecast at 52.6 million cwt, down 1.4 million cwt from the previous forecast and 9 percent below a year earlier. This is the lowest U.S. medium- and short-grain crop since 2008/09.
Harvested area was lowered this month in every reported State except Louisiana, where the 2017/18 harvested area estimate was raised just 1,000 acres, and in Mississippi where harvested area was unchanged.
In 2017/18, U.S. rice harvested area declined 702,000 acres from 2016/17, with area smaller in all six reported States.
Arkansas accounted for 61 percent of the harvested area decline. At 1.09 million acres, Arkansas’ 2017/18 rice harvested area is 28 percent below a year earlier and the smallest since 1987/88. Low price expectations at planting, higher expected returns for alternative crops, and severe flooding in late April through early May account for the substantial area decline in Arkansas and other States in the Delta.
Yields in 2017/18 are forecast higher than a year earlier in Arkansas, Louisiana, and Missouri, lower than last year in Texas, and nearly unchanged in California and Mississippi. At 7,300 pounds per acre, the Arkansas yield is 5.5 percent higher than a year earlier.
Production in 2017/18 is projected to be smaller than a year earlier in every reported State.
For the week ending September 10, 43 percent of the U.S. crop was reported harvested, behind last year’s pace of 48 percent but ahead of the U.S. 5-year average of 40 percent.
Total U.S. rice supplies in 2017/18 are projected at 250.0 million cwt, down 6.6 million cwt from the previous forecast and 44.1 million cwt below a year earlier. By class, U.S. long-grain supplies are projected at 179.1 million cwt, 5.6 million cwt below last month’s forecast and more than 14 percent smaller than a year earlier. Combined medium- and short-grain total supplies are projected at 67.3 million cwt, 1.7 million cwt below the August forecast and 17 percent below a year earlier and the smallest since 2008/09. The decline in medium- and short-grain supplies is due to a much smaller carryin and a smaller forecast crop.
At 46.0 million cwt, the 2017/18 U.S. all-rice beginning stocks estimate is fractionally above the previous forecast but 1 percent below a year earlier. Long-grain beginning stocks are estimated at 31.0 million cwt, down 0.2 million cwt from the previous forecast, but 37 percent above a year earlier and the highest since 2011/12. Combined medium- and short-grain beginning stocks are estimated at 11.5 million cwt, down 0.3 million cwt from the August forecast and 45 percent below a year earlier. U.S. imports in 2017/18 remain forecast at 24.2 million cwt, 3 percent larger than the year-earlier revised level.
Reduced Supplies Lower U.S. 2017/18 Export Forecast 3 Percent to 106.0 Million Cwt
Total use of U.S. rice in 2017/18 is projected at 221.0 million cwt, down 5.5 million cwt from the previous forecast and 11 percent below a year earlier. Both exports and domestic use (including a residual component) were lowered this month. At 115.0 million cwt, the total domestic and residual use forecast for 2017/18 is 2.5 million cwt below the previous forecast and 12.5 percent smaller than a year earlier.
Total U.S. rice exports in 2017/18 are projected at 106.0 million cwt, 3.0 million cwt below the previous forecast and 9 percent below a year earlier. Rough-rice exports are projected at 40.0 million cwt, down 1.0 million cwt from the previous forecast and 6 percent below a year earlier.
By class, long-grain exports are projected at 75.0 million cwt, down 2.0 million cwt from the previous forecast and 5 percent from a year earlier.
U.S. all-rice 2017/18 ending stocks are projected at 29.0 million cwt, down 1.1 million cwt from the previous forecast and 37 percent below a year earlier and the smallest since 2003/04. The ending stocks-to-use ratio is projected at 13.1 percent, down from 18.6 percent a year earlier and the lowest since 2007/08. The long-grain stocks-to-use ratio is forecast at 9.9 percent, down from 17.4 percent a year earlier and the lowest since 2003/04. Medium- and short-grain ending stocks are forecast at 9.3 million cwt, down 0.2 million cwt from the previous forecast and 19 percent below a year earlier. These are the smallest medium- and short-grain stocks since 2008/09. The medium- and short-grain stocks-to-use ratio is forecast at 16.1 percent, down slightly from 16.5 percent in 2016/17.
There were several small revisions to the U.S. 2016/17 balance sheet, based on market-year-end trade data and the August 1 stocks reported by NASS. On the supply side, 2016/17 imports were raised 0.2 million cwt to 23.5 million cwt, with long-grain accounting for almost all of the upward revision. On the use side, the 2016/17 export forecast was raised 0.65 million cwt to 116.65 million cwt, with long-grain exports raised 0.7 million cwt and medium- and short-grain exports lowered almost 0.1 million cwt.
In addition, data from the August NASS Rice Stocks report resulted in a 0.133-million cwt increase in the 2016/17 ending stocks estimate to 46.0 million cwt.
Tighter Supplies Again Boost 2017/18 U.S. Season-Average Farm Price Forecasts
For the third consecutive month, U.S. season-average price forecasts (SAPF) for 2017/18 for both classes of rice and for both growing regions were revised up. Like last month, this month’s upward revisions were largely based on tighter U.S. supplies, increases in both reported monthly cash prices and weekly spot prices, and expectations of prices during the remainder of the 2017/18 market year. Forecast 2017/18 SAFPs are well above 2016/17 SAFPs for both classes of rice.
The 2017/18 long-grain season-average farm price is projected at $12.00-$13.00 per cwt, up 50 cents on both ends from the previous forecast and well above the slightly revised $9.62 in 2016/17.
In August, USDA reported a long-grain monthly average cash price for July of $9.99 per cwt, up 47 cents from June and the highest since September and the third consecutive month of an increase. The California July medium- and short-grain cash price was reported at $14.00 per cwt, up 10 cents from June and the highest since September. The July southern medium- and short-grain price was reported at $10.70 per cwt, up 30 cents from June and the highest since February 2016. The July U.S. medium- and short-grain price was reported at $13.30 per cwt, up 20 cents from June. The all-rice July price was reported at $10.70 per cwt, up 50 cents from June and the highest since January. ∆
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