11th september,2015 daily exclusive oryza rice e newsletter by riceplus magazine

Daily Exclusive ORYZA Rice E-Newsletter Page 1 of 16

11th September, 2015

Vol 5.Issue XIV

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FAO Estimates 2015 Global Milled Rice Production to Increase Slightly to 500.6 Million Tons Sep 10, 2015

The UN's Food and Agriculture Organization (FAO) estimates 2015 global milled rice production to increase about 0.7% to around 500.6 million tons from around 497 million tons in 2014-15 and slightly above its previous estimate of around 499.3 million tons. The increase is attributed to India, where plantings are progressing in line with last season in spite of the prevailing El Ni単o.

The UN agency estimates 2015-16 global rice utilization at around 509.7 million tons (basis, milled), up about 8.4 million tons from last year. It expects the rice consumption at around 422 million tons, up about 1.7% from last year.

The FAO estimates 2015-16 global rice stocks at 169.6 million tons, down about 5% from last year due to offloading of inventories in the five major exporting countries. The world stocks-touse ratio is forecast at 32.6%, down from last year's 35%.

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The UN agency estimates 2015-16 world rice trade at around 42.1 million tons, slightly above last year's 42 million tons.

Chicago Rough Rice Futures Continue to Rally ahead of USDA S&D Update Sep 10, 2015

Chicago rough rice futures for Nov delivery settled 20.5 cents per cwt (about $5 per ton) higher at $12.670 per cwt (about $279 per ton). The other grains finished the day higher; Soybeans closed about 0.2% higher at $8.7400 per bushel; wheat finished about 1.2% higher at $4.7800 per bushel, and corn finished the day about 1.4% higher at $3.7425per bushel.

U.S. stocks attempted gains Thursday, as recovery in oil and major stocks offset increased uncertainty heading into the Federal Reserve's key meeting next week. Analysts said uncertainty over the timing of a rate hike kept stocks in a trading range. Crude oil reversed a 3.9% decline to briefly gain more than 3% to above $45.50 a barrel. Crude held higher despite weekly inventory numbers that showed a greater-than-expected build of 2.6 million barrels. The Federal Open Market Committee could raise short-term interest rates for the first time in more than nine years at its meeting next Wednesday and Thursday.

In economic news, initial jobless claims fell 6,000 to a seasonally adjusted 275,000 for the week ended Sept. 5, the Labor Department said on Thursday. It was the 27th straight week that claims remained below the 300,000 threshold, which is usually associated with a strengthening labor market. U.S. import and export prices posted their largest drop in seven months. The Dow Jones industrial average traded up 103 points, or 0.64%, at 16,357. The S&P 500 traded up 13 points, or 0.7%, at 1,955. The Nasdaq Gold is trading about 0.8% higher, crude oil is seen trading about 3.2% higher, and the U.S. dollar is seen trading about 0.6% lower about 1:00pm Chicago time.

Wednesday, there were 1,229 contracts traded, up from 587 contracts traded on Tuesday. Open interest – the number of contracts outstanding – on Wednesday increased by 298 contracts to 9,990.

FAO Global Rice Price Index Continues to Decline for Twelfth Consecutive Month Sep 10, 2015

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The FAO All Rice Price Index declined to around 209 points in August 2015, down about 0.9% from around 211 points in July 2015 the sub-indices declined or remained stable over the past month.

According to the FAO, the Higher and Lower Quality Indica sub-indices declined by about 2.7% and 1.6% respectively to around 179 points and 182 points. The Aromatic and Japonica subindices remained steady at around 175 points and 265 points respectively.

The FAO index has been declining continuously since September 2014. It declined about 13.6% during the one-year period. The FAO index value in August is the lowest since June 2010.

In January - August 2015, the FAO All Rice Price Index averaged 236 points, down about 8.7% from around 216 points during the same period last year. Sub-index for higher quality Indica rice prices declined about 11.1% y/y and sub-index for lower quality Indica rice prices declined about 7.3% y/y. Aromatic rice price sub-index declined about 29.8% y/y. However, sub-index for Japonica rice prices increased about 3% y/y.

According to the FAO, slow import demand and currency movements weighed on export quotations of the major suppliers. Rice export prices in Thailand declined due to softening of demand and the devaluation of baht against the dollar. The FAO says market weakness also impacted prices in other Aisan origins such as Pakistan and Viet Nam, as well as in South America. However, prices held steadier in the United States and Australia.

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During August 2015, average rice export prices of Thai 100% broken rice, Thai parboiled rice, Thai 5% rice, Thai 25% rice and Thai Fragrant rice declined to around $382 per ton, $387 per ton, $373 per ton, $362 per ton and $997 per ton respectively. But, average export prices of Thai A1 Super rice increased to around $324 per ton. Export prices of India 25% broken rice, Vietnam 25% broken rice and Pakistan 25% broken rice declined to around $339 per ton, $316 per ton and $324 per ton respectively.

U.S. 4% broken and Uruguay 5% broken rice declined to around $323 per ton, $332 per ton, $445 per ton and $526 per ton respectively.

Global Rice Quotes September 10th, 2015

Long grain white rice - high quality Thailand 100% B grade 355-365

↔

Vietnam 5% broken

320-330

↔

India 5% broken

365-375

↔

Pakistan 5% broken

315-325

↔

Myanmar 5% broken

420-430

↔

Cambodia 5% broken

420-430

↔

U.S. 4% broken 530-540

↔

Uruguay 5% broken

535-545

↔

Argentina 5% broken

530-540

↔

Long grain white rice - low quality Thailand 25% broken

330-340

↔

Vietnam 25% broken

315-325

↔

Pakistan 25% broken

290-300

↔

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Page 6 of 16 Cambodia 25% broken 405-415

↔

India 25% broken

340-350

↔

U.S. 15% broken

500-510

↔

Long grain parboiled rice Thailand parboiled 100% stxd

350-360

Pakistan parboiled 5% broken stxd

↔

415-425

↔

India parboiled 5% broken stxd 355-365

↔

U.S. parboiled 4% broken

570-580

↔

Brazil parboiled 5% broken

545-555

↔

Uruguay parboiled 5% broken NQ

↔

Long grain fragrant rice Thailand Hommali 92% 810-820

↔

Vietnam Jasmine

↔

450-460

India basmati 2% broken

NQ

↔

Pakistan basmati 2% broken

NQ

↔

Cambodia Phka Mails

830-840

↔

305-315

↔

Vietnam 100% broken 310-320

↔

Brokens Thailand A1 Super

Pakistan 100% broken stxd Cambodia A1 Super

275-285

355-365

↔

India 100% broken stxd 300-310

↔

↔

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Page 7 of 16 Egypt medium grain brokens

NQ

U.S. pet food

↔

335-345

Brazil half grain NQ

↔

↔

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

Cambodia May Not Bid for Philippines Tender Due to Uncompetitive Prices, Say Exporters Sep 10, 2015

Cambodian rice exporters have expressed concern that Cambodia may not bid for the Philippines tender for 750,000 tons as they cannot compete with Thailand and Vietnam exporters on price, according to local sources.

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The National Food Authority (NFA) of the Philippines, which was authorised for the import of 750,000 tonnes of rice, has invited the governments of Cambodia, Thailand and Vietnam to join the bidding process to fill the quota, according to a report from Reuters.

The Director-General of the state-owned agriculture company Green Trade told local sources that given higher costs of production, storage and transportation, Cambodia cannot lower its price to a large extent unlike Vietnam and Thailand. “Our cost of rice is still higher than other countries so we will consider joining the next bid when we can lower the cost of rice,” he said.

“We are on the process of discussing which sectors we can cut cost that would lower the cost of rice as a result,” he added.

In June this year, Cambodia lost in a tender invited by the NFA for import of 100,000 tons.

While Vietnam bid at around $416 per ton, Cambodia bid at around $455 per ton, which was much higher than the Philippines' reference price of $408.15 per ton.

The Acting Secretary of Cambodia Rice Federation (CRF) said: “NFA needs good quality rice at a low price and we could not compete with the cost of rice.” He added that the CRF members are still undecided over bidding for the Philippines tender.

Government of Thailand to Carry out Nationwide Inspection of Rice Warehouses Sep 10, 2015

Thailand's National Rice Policy Committee (NRPC) chaired by the Prime Minister has instructed the authorities in 51 provinces to carry out an inspection of about 13.5 million tons of rice stored in around 1,800 warehouses across the country, according to local sources.

Earlier inspections revealed that about 4.6 million tons of rice were sub-standard and about 1.3 million tons were rotten.

The latest inspection is to completed within 30 days and the officials are required to bifurcate the exact amount of good-quality and rotten rice. The findings will help the government fix an appropriate sale price for the rice, local sources quoted the Commerce Permanent Secretary as saying.

She told reporters that the prices received in the latest rice auction on September 8 were too low.

The average bidding price stood at around 9,460 baht per ton (around $262 per ton) compared to the 15,000 baht per ton (around $415 per ton) spent for procuring the paddy or about 24,000 baht

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per ton (around $664 per ton) for procuring milled rice. Adding the storage and maintenance costs, the loss to the state is said to be very high. The government has sold about 246,793 tons of stockpiled rice to 14 local traders in the tender raising about 2.33 billion baht (around $64.40 million).

The Thai military government sold about 4.55 million tons of rice raising about 48.63 billion baht (around $1.35) from ten auctions since it took over in May 2014.

Italy Rice Exports to Non-EU Nations Sluggish in First Week of New Crop Year Sep 10, 2015

Italy rice exports to the non-EU nations in the first week of 2015-16 crop year (SeptemberAugust) have more than halved to around 1,195 tons from around 2,494 tons during the same period last year, according to the data provided by the Italian Ministry of Economic Development.

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While exports to Long A varieties declined by about 71.9% to around 429 tons from around 1,522 tons last year, exports of Long B varieties declined by about 34% to around 196 tons from around 295 tons last year and exports of medium varieties declined by about 49.5% to around 195 tons from around 388 tons last year. However, exports of medium rice (milled basis) increased about 23% to around 375 tons from around 289 tons last year.

Exports to the U.S. registered the highest decline. They stood at around 54 tons compared to 835 tons last year. Exports to Turkey stood at around 24 tons compared to 271 tons last year; exports to Albania stood at around 18 tons compared to 243 tons last year; exports to Bosnia stood at around 24 tons compared to 206 tons last year; and exports to other destinations stood at around 29 tons compared to 404 tons last year.

India Rice Stocks in Central Pool Stand at 16.313 Million Tons as of September 1, 2015; Down 25% from Last Year Sep 10, 2015

India’s rice stocks in the central pool as of September 1, 2015 stood at around 16.313 million tons (including a milled equivalent of about 3.614 million tons of paddy), down about 25% from around 21.65 million tons recorded during the same period last year, according to data from the Food Corporation of India (FCI).

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Month-over-month, India's rice stocks in the central pool are down about 12% from around 18.6 million tons recorded on August 1, 2015. However, current rice stocks are about 61% more than the required buffer and strategic reserve norms of around 11.54 million tons for this time of the year, according to the FCI. Total food grain stocks (including rice and wheat) in the central pool stand at around 50.94 million tons as of September 1, 2015, down about 12% from last year's stock of around 57.893 million tons and down about 8% from last month's stock of around 55.523 million tons. Wheat stocks stand at around 34.474 million tons, down about 3% from last year's stock of around 35.498 million tons and down about 6% from last month's stock of around 36.778 million tons.

The government of India had revised the buffer norms for food grains, including rice, in the Central Pool in January this year. According to the new norms, buffer stocks for food grains to be maintained with the FCI at this part of the year is 41.12 million tons.

Oryza Overnight Recap – Chicago Rough Rice Futures Continue to Rally as Market Moves into Technical Uptrend Sep 10, 2015

Chicago rough rice futures for Nov delivery are currently paused 12 cents per cwt (about $3 per ton) higher at $12.585 per cwt (about $277 per ton) ahead of floor trading in Chicago. The other grains are seen trading mostly lower ahead of early morning action; soybeans are currently seen trading about 0.4% lower, wheat is listed about 0.3% higher and corn is currently noted about 0.2% lower.

U.S. stock index futures pared gains to trade in negative territory Thursday after another day of volatility on Wednesday and another round of disappointing data from Japan and China. Traders will likely look past economic reports Thursday and the normal triggers of market movements to see if conditions stabilize, creating an environment where the Fed would be more comfortable hiking rates for the first time in more than nine years. The Dow Jones industrial average, S&P 500 futures held lower, with the Dow futures off about 50 points after earlier dipping more than 100. Nasdaq futures briefly attempted slight gains. Wall Street is plainly split on whether the Fed will hike next week, with some saying the markets are already displaying enough volatility to sideline the central bank for several months or more.

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But most agree the markets have not priced in a rate increase, and there could be a violent reaction to whatever it does. On the data front, initial jobless claims fell 6,000 to a seasonally adjusted 275,000 for the week ended Sept. 5, the Labor Department said on Thursday. It was the 27th straight week that claims remained below the 300,000 threshold, which is usually associated with a strengthening labor market. U.S. import and export prices posted their largest drop in seven months. In Europe, the pan-European STOXX 600 index was more than 1% lower after weak data from Japan and China. Core machinery orders in Japan fell by 3.6% in July, while in China, the producer price index fell by 5.9%. Gold is currently trading about 0.9% higher, crude oil is seen trading about 0.8% higher, and the U.S. dollar is currently trading about 0.1% lower at 8:15am Chicago time.

Oryza U.S. Rough Rice Recap - Prices Rally ahead of WASDE; Chinese Protocol Developments Add to Bullish Sentiment Sep 10, 2015

The U.S. cash market was on fire today although sellers were difficult to come by ahead of the tomorrow’s USDA World Agriculture Supply and Demand Estimate.

Analysts expect that the USDA will cut their acreage figure as well a field yield projection which will tighten next year’s endings stocks figure however estimates vary as to how much the USDA will cut the latter.

Adding to the bullish tone today, were reports that the U.S. is one step closer to finalizing phytosanitary rules with China that would be necessary to allow U.S rice imports into that country.

Many in the industry see this as a huge development for U.S. rice exports, as China is the greatest consumer of rice, however others are more cautious noting that the deal has yet to be signed.

Oryza Global Weather Outlook Sep 10, 2015

Rain is expected in China from Shanxi, southwest to Yunnan and Sichuan on Thursday and Friday. In Guizhou, Guangxi and Guangdong, isolated showers are expected through Friday.

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In India, scattered showers are expected from Maharashtra to southern Odisha on southward through Sunday. Weather is expected to remain dry across the rest of India through Sunday.

Scattered showers are expected across Bangladesh on Thursday and Friday.

In Indonesia, scattered showers are expected across northern Sumatra and Borneo on Thursday and Friday. Weather is expected to remain dry in Sulawesi, southern Borneo and southern Sumatra.

Scattered showers are expected across most parts of Vietnam on Thursday and Friday.

Scattered showers are expected across Thailand on Thursday and Friday.

Weather is expected to remain dry across Pakistan through Sunday.

In the U.S., rice producers had harvested 35% of this year’s crop by September 6. Overall, 65% of the rice was reported in good to excellent condition.

Thailand Rice Sellers Lower Some of Their Quotes; Other Asia Rice Quotes Unchanged Today Sep 10, 2015

Thailand rice sellers increased their quotes for 5% broken rice by about $5 per ton to around $340-$350 per ton today. Other Asia rice sellers kept their quotes mostly unchanged.

5% Broken Rice Thailand 5% rice is indicated at around $340 - $350 per ton, down about $5 per ton from yesterday and about $20 per ton premium on Vietnam 5% rice shown at around $320 - $330 per ton. India 5% rice is indicated at around $365 - $375 per ton, about $50 per ton premium on Pakistan 5% rice shown at around $315 - $325 per ton.

25% Broken Rice Thailand 25% rice is shown at around $330 - $340 per ton, about $15 per ton premium on Vietnam 25% rice shown at around $315- $325 per ton. India 25% rice is indicated at around

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$340 - $350 per ton, about $50 per ton premium on Pakistan 25% rice shown at around $290 $300 per ton.

Parboiled Rice Thailand parboiled rice is indicated at around $350 - $360 per ton. India parboiled rice is indicated at around $355- $365 per ton, about $60 per ton discount to Pakistan parboiled rice last shown at around $415 - $425 per ton.

100% Broken Rice Thailand broken rice, A1 Super, is indicated at around $305 - $315 per ton, about $5 per ton from premium on Vietnam 100% broken rice shown at around $300 - $310 per ton. India's 100% broken rice is shown at around $300 - $310 per ton, about $25 per ton premium on Pakistan broken sortexed rice shown at around $275 - $285 per ton.

USDA Post Lowers Vietnam 2015 Rice Export Estimates on Increased Competition, Declining Demand Sep 10, 2015

USDA Post has lowered its estimates for Vietnam's 2015 rice exports to 6 million tons, down about 10% from USDA's official estimate of around 6.7 million tons and down about 5% from an estimated 6.325 million tons last year. The downward revision is mainly due to expected strong competition from Thailand, India, Pakistan and other new exporters such as Cambodia and Myanmar; as well as lower demand from its main importer China.

The Post estimates Vietnam's 2014-15 (January-December 2015) paddy rice production to reach around 44.92 million tons (around 28.07 million tons, basis milled), slightly up from USDA's official estimate of around 44.88 million tons (around 28 million tons, basis milled) due to the increase of production of autumn crop in the Mekong River Delta (MRD). The increase of production of autumn crop in the MRD also off set the slight decrease of production of total Vietnam’s spring crop, and mild decrease of autumn crop in other areas of Southern Vietnam , especially in the south central coastland areas that were impacted by strong drought conditions caused by El Nino.

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USDA Post estimates 2014-15 rice stocks to reach about 973,000 tons, up from USDA's official estimates of around 849,000 tons but down from last year's 999,000 tons due to likely increase in production and a decline in consumption.

The amount of rice used for average per capita consumption has decreased because of the availability of other food sources, according to the Post. However, consumption of rice has been increasing in the feed industry. Currently, per capita rice consumption is 136 kilograms.

Vietnam Rice Exports to Africa Decline Sharply in July 2015 Sep 10, 2015

Vietnam's rice exports have declined sharply in July 2015 reportedly due to a decline in export demand and stiff competition from India and Thailand. While share of Vietnam's rice exports to Asian and European destinations increased in July 2015, its share of exports to Africa, American and Australian destinations declined during the month.

Vietnam has exported around 606,485 tons of rice in July 2015, down about 2% from around 620,431 tons exported in June 2015, and down about 1% from around 614,677 tons exported in July 2014, according to USDA.

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Asia accounted for around 492,334 tons (about 81% of total rice exports by Vietnam in July 2015) during the month. Month-on-month, Vietnam's rice exports to Asian destinations increased about 8% from around 456,928 tons exported in June 2015. Year-on-year, they increased about 4% from around 474,021 tons exported in July 2014.

Vietnam exported around 70,819 tons of rice to Africa (about 12% of total July 2015 exports) in July 2015, down about 18% from around 86,848 tons exported in June 2015, and down about 39% from around 115,668 tons exported in July 2014.Vietnam exported around 22,375 tons of rice to American destinations (about 4% of July 2015 exports), down about 64% from around 63,682 tons exported in June 2015, and up about 77% from around 12,637 tons exported in July 2014.

Vietnam's exports to Australia (about 0.4% of July 2015 exports) declined about 17% to around 2,472 tons in July 2015 from around 2,969 tons exported in June 2015 and increased about 20% from around 2,062 tons exported in July 2014.Vietnam's exports to Europe and CIS countries (about 3% of total July 2015 exports) accounted for around 18,485 tons in July 2015, up about 85% from around 10,004 tons exported in June 2015 and up about 80% from around 10,289 tons exported in July 2014.

In terms of grade, 5% broken rice exports accounted for around 147,513 tons (or, about 24% of total July 2015 exports); Jasmine rice exports accounted for around 103,574 tons (or, about 17% of total July 2015 exports); 15% broken rice exports accounted for around 53,715 tons (or, about 9% of total exports in July 2015); 25% broken rice exports accounted for around 185,841 tons (or, about 31% of total exports in July 2015); glutinous rice exports accounted for around 30,320 tons (or, about 5% of total July 2015 exports); and 10%, 100% and other varieties accounted for around 85,522 tons (or, about 14% of total exports in July 2015).

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