12th march,2015 daily exclusive oryza rice e newsletter by riceplus magazine

Daily Exclusive ORYZA Rice E-Newsletter www.ricepluss.com

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Daily Exclusive ORYZA Rice

Newsletter

Volume 5, Issue I

March 12, 2015


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Thailand Plans to Sell 780,000 Tons of Rice in

March 6 Tender

Mar 11, 2015

Thailand received bids for around 780,000 tons of rice of the one million tons auctioned in its

second auction on March 6, 2015, and the government may approve sale to all bidders who

tendered in the auction, according to Bloomberg.The National Rice Policy Committee chaired by

the Prime Minister is to approve the sales.The military government sold about 1.18 million tons

of rice from five auctions raising around 17.21 billion baht (around $528 million) since it seized

power in May 2014.The government currently holds 17.8 million tons and is planning to sell

around 10 million tons this year and around 7 million tons next year.Meanwhile, the government

is planning to sell the degenerated rice after August 2015 when the investigation against those

involved in the sales of low-grade rice is expected to be over. Local and foreign companies are

reportedly interested in buying the low grade rice for use in non-food industries.


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Perennial Rice: Revolution in Rice

Cultivation Mar 11, 2015

Rice is a labor and water intensive crop, and of late the global warming and climate changes

have been posing severe challenges for rice production thereby threatening the world food

security. Rice cultivation is also said to harm the environment by eroding soil fertility as well as

releasing harmful greenhouse gases into the atmosphere.

Researchers are working towards developing a perennial rice variety, which need not be planted

every year, and will yield good amount of rice for many years. Such a variety can be developed

by crossing domesticated rice varieties with its wild predecessors, say researchers. Such a variety

are deep-rooted and so they can hold soils in place for a long time , survive extremes of weather

conditions and water supply.

Chinese scientists at the China-based Yunnan Academy of Agricultural Sciences are on the verge

of completing a decade long trials on a perennial rice variety PR23, which can provide yields


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similar to conventional rice varieties for over four years. China's National Science Foundation

and Land Institute have started a series of field trials on PR23 and once the Yunnan government

approves the variety, it may be grown commercially.

However, critics say perennial varieties are low yielding and would not be able to feed the

world's growing population. They also noted that one potential difference between the traditional

varieties and perennial rice varieties is that while traditional varieties divert 30-60% of their

energy to producing seeds, perennial varieties divert the same energy to growing roots to help

plants sustain for years.

Rising Imports and Continuing Political

Unrest Impact Bangladesh Rice Sector

Mar 11, 2015


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Bangladesh rice sector is facing severe trouble due to increasing imports and continuing political

blockades, according to local sources.Bangladesh's rice imports reached four year high as the

private sector has imported over 875,350 tons of rice from India so far in this fiscal year (July

2014 - June 2015) due to low prices in India. According to local sources, prices of medium

quality rice in India currently stand at about Tk 24.5-25.2 per kilogram (around $314-$323 per

ton) compared to Tk 27 per kilogram (around $346 per ton) of the same quality rice in Dhaka.

The increased imports have reduced demand for local coarse rice and millers are left with huge

stocks.

On the other hand, due to the continuing political blockades that started on January 5 this year,

prices of paddy and rice in the wholesale markets have declined drastically as traders are not

interested to buy paddy due to shutdowns and slow demand for local rice. According to local

traders, prices of paddy fell to around Tk 630 per 40 kilograms (around $202 per ton) from

around Tk 700 per 40 kilogram (around $224 per ton) during the same time last year. Farmers

are also concerned that they are unable to breakeven this year due to high production costs and

low returns.

Traders also expressed concern that prices may still plummet once the Boro (January - May)

harvesting begins next month.Bangladesh produced around 34.449 million tons of rice, basis

milled, in FY 2013-14 (July - June), up about 2.7% from around 33.833 million tons produced in

FY 2012-13, according to the Agriculture Ministry.Bangladesh's 2015 rice imports are likely to

surpass both FAO and USDA estimations. The FAO estimates Bangladesh to import 400,000

Tons, down about 33% from an estimated 600,000 tons in 2014 due to an expected increase in

production in 2014. USDA estimates Bangladesh to import around 600,000 tons of rice in 2015,

down about 20% from an estimated 751,000 tons imported in 2014.

Guyana Plans to Secure Additional 10,000

Rice Export Contract with Venezuela

Mar 11, 2015


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Guyana, which has recently secured the deal to export around 250,000 tons of paddy and rice to

Venezuela, is planning to secure export contract for another 10,000 tons as well due to lack of

lucrative export markets for its rice, according to local sources.The Guyana Rice Development

Board (GRDB) who left for Venezuela to sign the export deal yesterday told local sources that

Venezuela purchased around 250,000 tons of paddy and rice from Guyana under the Petro

Caribe deal in 2014. The government has decided to convince Venezuela to buy another 10,000

tons taking the total export figure to around 260,000 tons.

He noted that farmers are not convinced with the prices offered by new markets in the Central

America, North America and Europe. The Rice Producers Association (RPA) President added

that there are markets for Guyana rice but Venezuela's prices for Guyana's high quality rice and

paddy are high compared to other countries' offers.The government also signed a contract with

Panama in August 2014 to export 50,000 to 60,000 tons annually. Though the contract has still

not been renewed for 2015, local sources say the government is optimistic about the continuation

of the contract.


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With an expected increase in production, the government has been exploring new markets for its

rice. The Agriculture Minister noted that the government has struck deals with new markets in

Central America and Africa apart from the existing markets.Guyana produced around 633,000

tons of rice in 2014, up about 18% from around 535,212 tons from 2013; and exported around

501,208 tons of rice in 2014, up about 27% from around 394,000 tons exported in 2013,

according to the Agriculture Minister.

The Caribbean nation aims to produce about 618,000 tons of milled rice and export around

521,000 tons in 2015.USDA estimates Guyana to produce 633,000 tons of milled rice in the MY

2014-15 (January 2014 - December 2014) and export about 500,000 tons. The FAO estimates

Guyana to produce 570,000 tons of milled rice and export around 460,000 tons in 2014.

Thailand Rice Sellers Lower Some of Their

Quotes; India Rice Quotes Mixed Today

Mar 11, 2015

Thailand rice sellers lowered their quotes for Hommali rice by about $10 per ton to around $910

- $920 per ton. India rice sellers increased their quotes for 25% broken rice by about $5 per ton

to around $360 - $370 per ton and lowered their quotes for Parboiled rice and 100% broken rice

by about $5 per ton each to around $380 - $390 and $275 - $285 per ton respectively. Other Asia

rice sellers kept their quotes mostly unchanged today.

5% Broken Rice

Thailand 5% rice is quoted at around $395 - $405 per ton, about $30 per ton premium on

Vietnam 5% rice shown at around $365 - $75 per ton. India 5% rice is quoted at around $390 -

$400 per ton, about $45 per ton premium on Pakistan 5% rice quoted at around $345 - $355 per

ton.

25% Broken Rice

Thailand 25% rice is quoted at around $365 - $375 per ton, about $20 per ton premium on

Vietnam 25% rice shown at around $345- $355 per ton. India 25% rice is quoted at around $360

- $370, up about $5 per ton from yesterday and about $50 per ton premium on Pakistan 25% rice

quoted at around $310 - $320 per ton.

Parboiled Rice


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Thailand parboiled rice is quoted at around $400 - $410 per ton. India parboiled rice is quoted at

around $380 - $390 per ton, down about $5 per ton from yesterday and about $15 per ton

discount to Pakistan parboiled rice quoted at around $395 - $405 per ton.

100% Broken Rice

Thailand broken rice, A1 Super, is quoted at around $325 - $335 per ton, about $15 per ton

premium on Vietnam 100% broken rice shown at around $310 - $320 per ton.

India's 100% broken rice is shown at around $275 - $285 per ton, down about $5 per ton from

yesterday and about $5 per ton discount to Pakistan broken sortexed rice quoted at around $280

- $290 per ton.

China, Thailand Sort Out Details of Rice and

Rubber Deals Mar 11, 2015

Thailand and China have come to a clarity over details of a deal signed between the two

countries in December 2014 when the Chinese Premier Visited Thailand, according to


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Reuters.According to the deal, China agreed to buy around 2 million tons of rice and around

200,000 tons of rubber from Thailand. Today, representatives of both the countries sorted out

details of the deal. China has reportedly sought to buy 1 million tons of 5% broken rice from the

new crop and 1 million tons from the stockpiles in 2015-16.

The Thai Commerce Minister told reporters that both the governments will form a steering

committee to oversee the implementation of the deal. He also noted that Thailand's Department

of Foreign Trade and Rubber Estate Organization will work closely with China's state-owned

COFCO and Sinochem respectively regarding pricing details.Last year, China also signed

another memorandum of understanding (MOU) with Thailand to import one million tons of rice.

So far, Thailand shipped only 300,000 tons of rice to China. Sources at the Commerce Ministry

told reporters that Thailand is keen on completing the shipment of the remaining 700,000 tons

and has urged Chinese authorities to quickly take delivery of the same.The Commerce Ministry

sources also noted that the present deal is a positive indication for increase in future Thai

agricultural exports to China.

Oryza Overnight Recap – Chicago Rough

Rice Futures Higher Overnight as Grains

React Positively to Yesterday’s USDA S&D

Report

Mar 11, 2015

Chicago rough rice futures for May delivery are currently listed 5 cents per cwt (about $1 per

ton) higher at $10.495 per cwt (about $233 per ton) ahead of early floor trading in Chicago. The

other grains are seen trading higher this morning: soybeans are currently seen about 0.7% higher,

wheat is listed about 1.4% higher and corn is currently noted about 1% higher.U.S. stock index

futures pointed to a higher start to Wall Street trade on Wednesday, as European shares rose

following a global selloff on Tuesday. Markets remained jittery ahead of the Federal Reserve

meeting next week, at which the U.S. central bank could signal that it is getting closer to hiking

record low interest rates—potentially as soon as June. Meanwhile, the euro continued to slump

against the U.S. dollar, falling to $1.06 on Wednesday.

Bets are on as to when the euro could reach parity against the greenback, with the currency

pressured lower as the European Central Bank's quantitative easing program gets underway. This

has helped push the dollar to multi-year highs. Weekly mortgage applications dropped as rates

jumped, with the 1.3% decline driven mostly by a 3% drop in refinance applications, which


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makes up 60% of all applications. That volume was 80% in recent years. There will also be a

Treasury auction of benchmark 10-year notes.

The yield on Wednesday morning traded slightly higher to near 2.15%, below the key 2.28%

level analysts are watching for. The U.S. government's oil inventory data will be of particular

interest, after the American Petroleum Institute reported the first weekly drop in crude supplies

in two months on Tuesday. The Fed will also publish further stress test results for large U.S.

banks, assessing their capital plans. Traders will also be keeping tabs on the debt negotiations

between Greece's newly installed left-wing government and the "troika" of international

institutions supervising its bailout program. Gold is currently trading about 0.2% lower, crude oil

is seen trading about 1% higher, and the U.S. dollar is currently trading about 0.7% higher at

8:00am Chicago time.

Oryza Afternoon Recap - Chicago Rough

Rice Futures Rally as Market Continues to

Derive Support from Bullish USDA S&D

Update

Mar 11, 2015

Chicago rough rice futures for May delivery settled 21.5 cents per cwt (about $5 per ton) higher

at $10.735 per cwt (about $237 per ton). Rough rice futures rallied today, supported by firmer

grain prices and an apparent change of sentiment noted during mid-day trading today. Despite

getting off to a sluggish start and trading mostly sideways for the majority of the morning,

buying interest peaked later in the day and saw prices rally over 20 cents per cwt (about $4 per

ton) by the ringing of the closing bell. Traders will look to tomorrow’s close as an indication of

future trade direction, as a reversal lower could erase the technical importance of today’s gain.

On the other hand a continuation higher with a breakout above overhead resistance around

$10.800 per cwt (about $238 per ton) would likely trigger additional technical buying.

The other grains also finished higher today, led by an over 1% rally in wheat as the market

continues to react to yesterday’s bullish USDA S&D update; Soybeans closed about 0.8% higher

at $9.9275 per bushel; wheat finished about 1.2% higher at $4.9900 per bushel, and corn finished

the day about 0.8% higher at $3.9100 per bushel.U.S. stocks traded mildly lower on Wednesday

as equities failed to recover from Tuesday's selloff, amid continued concern over dollar gains and

the timing of a Fed interest rate hike. Oil futures extended losses on Wednesday after


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government data showed U.S. commercial crude inventories rose by 4.5 million barrels last

week, well above an industry group report released on Tuesday.

The three major indices initially traded higher before falling to trade just below Tuesday's close.

The euro continued to slump against the U.S. dollar, dipping below $1.06 on Wednesday to a 12-

year low. Bets are on as to when the euro could reach parity against the greenback, with the

currency under pressure as the European Central Bank's quantitative easing program kicked off

this week. The euro's decline helped push the dollar to multi-year highs. Weekly mortgage

applications dropped as rates jumped, with the 1.3% decline driven mostly by a 3% drop in

refinance applications, which makes up 60% of all applications.

That volume was 80% in recent years. The Treasury Department auctioned $21 billion of 10-

year notes at a high yield of 2.13%. The bid-to-cover ratio, an indicator of demand, was the

highest since December at 2.65. The Dow Jones Industrial Average gained 31 points, or 0.19%,

at 17,695. The S&P 500 traded up 1.87 points, or 0.09%, at 2,046, with financials leading six

sectors higher and consumer staples the greatest laggard. The Nasdaq traded up 3 points, or

0.06%, to 4,862. Gold is trading about 0.8% lower, crude oil is seen trading about 1.5% lower,

and the U.S. dollar is seen trading about 1.3% higher at about 1:00pm Chicago time.Tuesday,

there were 245 contracts traded, down from 370 contracts traded on Monday. Open interest – the

number of contracts outstanding – on Tuesday decreased by 97 contracts to 8,966.

Conab Estimates Brazil 2014-15 Paddy Rice

Production at 12.152 Million Tons, Slightly

Up from Last Year

Mar 11, 2015

Brazil’s National Grains Supply Company (Conab) has forecasted the country's 2014-15 paddy

rice production at around 12.152 million tons (around 8.26 million tons, basis milled), slightly up

from around 12.122 million tons (around 8.24 million tons, basis milled) in 2013-14.Conab has

estimated Brazil's 2014-15 paddy rice acreage at around 2.333 million hectares, down about 2%

from around 2.373 million hectares in 2013-14. Paddy rice acreage in the key rice growing

Centro-Sul (Center-South) region is projected at 1.548 million hectares in 2014-15, down about

1% from around 1.565 million hectares in 2013-14.

Rice acreage in the North/Northeast regions is estimated at around 784,600 hectares, down 3%

from around 808,400 hectares in 2013-14.Average rice yield in Brazil in 2014-15 is projected at


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around 5.209 tons per hectare, up about 2% from around 5.108 tons per hectare recorded in the

previous year.USDA estimates Brazil MY 2014-15 (April – March) paddy rice production at

around 12.206 million tons (around 8.3 million tons, basis milled), unchanged from MY 2013-

14. It estimates Brazil’s 2014-15 paddy rice acreage also to remain at last year's level of around

2.4 million hectares. USDA estimates Brazil to export around 900,000 tons of rice and import

around 700,000 tons of rice in 2014.

Global Rice Quotes

March 11th, 2015

Long grain white rice - high quality

Thailand 100% B grade 410-420 ↔

Vietnam 5% broken 365-375 ↔

India 5% broken 390-400 ↔

Pakistan 5% broken 345-355 ↔

Myanmar 5% broken 415-425 ↔

Cambodia 5% broken 425-435 ↔

U.S. 4% broken 480-490 ↔

Uruguay 5% broken NQ ↔

Argentina 5% broken NQ ↔


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Long grain white rice - low quality

Thailand 25% broken 365-375 ↔


Pakistan 25% broken 310-320 ↔

Cambodia 25% broken 410-420 ↔

India 25% broken 360-370 ↑

U.S. 15% broken 470-480 ↔

Long grain parboiled rice

Thailand parboiled 100% stxd 400-410 ↔

Pakistan parboiled 5% broken stxd 395-405 ↔

India parboiled 5% broken stxd 380-390 ↓

U.S. parboiled 4% broken 555-565 ↔

Brazil parboiled 5% broken 570-580 ↔

Uruguay parboiled 5% broken NQ ↔

Long grain fragrant rice

Thailand Hommali 92% 910-920 ↓

Vietnam Jasmine 465-475 ↔

India basmati 2% broken NQ ↔

Pakistan basmati 2% broken NQ ↔

Cambodia Phka Mails 790-800 ↔

Brokens

Thailand A1 Super 325-335 ↔


Pakistan 100% broken stxd 280-290 ↔

Cambodia A1 Super 345-355 ↔

India 100% broken stxd 275-285 ↓

Egypt medium grain brokens NQ ↔

U.S. pet food 380-390 ↔

Brazil half grain NQ ↔

All prices USD per ton, FOB vessel, oryza.com

California Drought May Hold Global

Medium-Grain Rice Prices Firm, Says

Australian Rice Expert


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Mar 11, 2015

California's ongoing drought is expected to hold on the medium-grain rice prices firm and

prevent them from falling, according to the CEO of an Australian rice processing company.The

official made these remarks ahead of the rice harvest in Australia's key rice growing area New

South Wales. Australia also produces medium-grain rice and California is a major competitor to

Australia in this segment.He noted that drought conditions in the U.S. state have led to drying up

of reservoirs and Californians are relying on snowpack, as it melts and flows into reservoirs.

However, the flow from snowpack also fell about 24% from last year. In this situation,

Californians are resorting to purchasing water for both domestic and agricultural purposes.The

Australian official expressed optimism that prices this year would remain firm in the U.S. as rice

producers who are likely to spend heavily on water for irrigation purposes may not allow prices

to dip unusually.California mostly produces medium-grain rice and is the second largest rice

producing state in the U.S. after Arkansas, and contributes to around 2 million tons of paddy rice

annually or about 25% of the total rice grown in the U.S. The state's rice sector, which employs

about 25,000 people and exports most of the rice grown here, had been impacted by drought last

year.

The state's paddy rice acreage in 2014 had declined to around 420,000 hectares, down about 25%

from around 525,000 hectares planted in 2013 due to prolonged dry conditions and water

shortages.Currently, export prices of the U.S. medium grain rice stand at around $870 per ton,

down about 5% from around $915 per ton in the beginning of this year.The Australian Bureau of

Agricultural and Resource Economics and Sciences (ABARES) forecasts Australia's paddy rice

production in MY 2014-15 (April 2014 - March 2015) to decline to around 684,000 tons (around

492,000 tons, basis milled), down about 18% from an estimated 833,000 million tons (around

600,000 tons, basis milled) in MY 2013-14 due to water shortages and corresponding reduction

in yields. The situation is likely to impact local prices in the short run.


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USDA Forecasts U.S. MY 2014-15 All Rice

Exports at 4.72 Million Tons, Up 11% from

Last Year

Mar 11, 2015

In its March World Agricultural

Supply and Demand Estimates

(WASDE) report, the USDA has

forecasted U.S. MY 2014-15 all rice

exports at around 4.72 million tons,

up about 11% from last year and up

about 1% from its February

forecasts.USDA forecasts the U.S.

long-grain exports to increase to

around 3.27 million tons, up about

14% from last year's 2.86 million

tons and up about 1.5% from last

month's 3.22 million tons based on

an expected increase in exports to

markets in the Western

Hemisphere.Accordingly, USDA

lowered its estimates for U.S. MY

2014-15 all rice ending stocks by

about 2% to around 1.86 million

tons from its last month's estimates

of around 1.9 million tons. It

estimates U.S. all rice ending stocks to increase about 25% y/y in MY 2014-15. USDA lowered

estimates for U.S. MY 2014-15 long-grain ending stocks by about 3% to around 1.23 million

tons from last month's estimate of around 1.27 million tons. It estimates U.S. long-grain rice

ending stocks to increase about 40% y/y in MY 2014-15.USDA estimates U.S. all rice farm

prices to increase to around $308.64 - $321.82 per ton from last month's estimates of around

$302.03 - $315.26. It increased estimates for long-grain rice farm prices to around $268.96 -

$282.19 per ton and estimates for combined medium and short-grain farm prices to around

$399.03 - $416.67.The USDA has kept its forecasts for U.S. all rice production and imports

unchanged from last month.

12th march,2015 daily exclusive oryza rice e newsletter by riceplus magazine

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