In the June World Agricultural Supply and Demand Estimates report released Tuesday (June 12), projected ending stocks for the 2001/02 marketing season were left unchanged at 21.9 million cwt. While the overall U.S. balance sheet remains unchanged, the USDA raised the estimates for U.S. milled rice exports, and lowered U.S. paddy export estimates by 2 million cwt each for both the 2000-01 and the 2001-02 marketing seasons.
The USDA reports that the pace of U.S. paddy exports in 2000/01 slowed recently and is expected to remain slower through the end of the marketing year. The new 2000-01 export estimate for paddy is 200,000 cwt below the 1999-00 level at 25.0 million cwt.
While there was some initial concern that heavy rains from tropical depression Allison in Texas and southwest Louisiana last week might cause extensive damage to crops, the aided the rice crop in dry areas. Damage from the storm appears to be small, and may mostly emerge due to missed crop treatments. In the June 11 crop report, the USDA reported that 76% of the U.S. rice crop rates in good to excellent condition.
Members of the U.S. Senate and House of Representatives plan to introduce bills this week that would change the terms of U.S. trade with Cuba. The bills would authorize unrestricted sales of food, farm equipment and medicines, eliminate the restrictions on transportation of legal goods, and end the ban on travel to Cuba.
In Asia, Vietnamese rice prices are mostly steady on continued shipments, a still sizeable book of unshipped orders, and stable supply. New demand is weak as many traders think that lower prices may emerge when supply from the summer crop enters the market in July and August.
Vietnamese vessel-loading activity peaked mid-May and has now declined for several consecutive weeks. The main destination for Vietnamese rice is the Philippines, with smaller tonnage headed for Africa and Iraq. Vietnamese exporters hopeful that Iran would make a large purchase following the visit of an Iranian delegation to the country remain disappointed.
Thai rice prices are mostly steady this week. The government sale of 100,000 tons of 100%B to Iran and shipments to Malaysia and Nigeria are helping to support Thai prices despite a lack of fresh demand.
Approximately 1 million tons of paddy is still being stored in warehouses by millers participating in the Thai government's last intervention plan (November-March). Under the plan, farmers received money for handing paddy over to participating millers. Producers are now failing to redeem this paddy due to low domestic prices. As a result, participation in the current dry season intervention program is suffering. Millers are expressing concern to the government that the quality of the government-owned paddy is deteriorating.
Rather than relying solely on state-run agencies, the Food Corporation of India has reportedly given private exporters the approval to export rice from the 3 million tons of rice recently authorized for sale abroad. Activity in the Indian market remains limited. Although Indian prices are now more competitive with other Asian sources, there is limited interest in Indian rice because of quality concerns. Indian exporters are aggressively pursuing potential business in Brazil, Chile and Colombia.
Pakistani rice prices are steady and are expected to remain firm for the next few months due to tight supply now seen at approximately 100,000 to 150,000 ton range. Most traders appear unwilling to part with large quantities of this due to the likelihood of a reduced and delayed new crop harvest.
A delegation from the Philippine National Food Authority (NFA) is visiting rice factories in Pakistan, judging the quality of Pakistani rice. Pakistani traders want the NFA to accredit the country as a source country for Philippine rice imports. Currently, only Vietnam, Thailand and China are accredited as source countries by the NFA.
In the supply and demand report, the USDA reduced global ending stock estimates for the 2000-01 season by more than 1 million tons to 134.39 million tons. Global production projections for the 2001-02 season were lowered by 3.5 million tons to 396.41 million tons, while global export estimates for the 2000-01 season were lowered by 450,000 tons.
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