3rd august (monday),2015 daily exclusive oryza rice e newsletter by riceplus magazine

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August 3, 2015 Vol 5 ,Issue VII

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Bangladesh Urged to Maximize Use of Rice Bran for Edible Oil Production Jul 31, 2015

The Bangladesh Tariff Commission (BTC) urged the government to maximize the use of rice bran in order to increase the edible oil production in the country, according to Financial Express.A study titled 'Rice Bran Oil and its Prospect in Bangladesh' by the BTC found that only 500,000 tons, or less than a quarter of around 2.5 million tons of rice bran produced in the country is used by local oil companies to produce edible oil.

It noted that local edible oil companies produce hardly 100,000 tons of rice bran oil annually while the country has the potential to produce nearly 700,000 tons yearly.

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The study noted that currently only 70% of rice mills are automatic or semi-automatic while the remaining are yet to be modernized. BTC member and the team leader of the study noted that Bangladesh produces nearly 51 million tons of paddy yearly and if all the mills are automated, the production of rice bran could reach over 3.6 million tons.

He states that by 2021, demand for edible oil is expected to increase to around 2.47 million tons from the current 1.5 million tons. If all rice mills in the country are automated and use of rice bran in maximized by 2021, rice bran oil could cater to about 30% of the total edible oil demand.

However, the study found that the export of rice bran has been declining over the past few years.

Bangladesh exporters shipped around 27,076 tons of rice bran in FY 2013-14 compared to around 90,781 tons in FY 2012-13.

The study also recommended that the awareness about the use of rice bran oil should be increased among the consumers.

The President of the Bangladesh Auto Major and Husking Mills Owners Association expressed optimism that demand for rice bran would increase in the country over the next five years.

Improved Monsoon Rains Support India 2015-16 Main Paddy Rice Crop Sowing Jul 31, 2015

Total area planting to India's 2015-16 Kharif (main) rice crop (June - December) stood at around 22.8 million hectares as of July 31, 2015, up about 6% from around 21.5 million hectares planted during the same time last year, according to a press release by the Agriculture Ministry.

Indian monsoons which were 7% below normal in the previous week have improved and are 4% below normal as on July 30, according to the Indian Meteorological Department (IMD). Central, south peninsular and north-east regions received 2%, 19% and 9% below average rains during the week. However, the north-west region received 12% above-average rainfall.

Monsoon rains in July were originally forecast to be 12% below normal. However, due to the monsoons' sudden peaking on the west an east coast of the country brought some respite to agriculturists. Last week, the Economic Times quoted the Director of the Central Rice Research Institute (CRRI) as saying that the 2015-16 kharif rice output may not be significantly impacted if the monsoon deficit is curbed at 10%.

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A likely drought-inducing El Nino this year is expected to lower production prospects this year.

The IMD has forecasted the El Nino pattern to reach to moderate to a strong one during the monsoon season (June – September). Indian-based private weather forecaster Skymet, which earlier predicted rains to be 102% of 50-year average, has told that the rains may be 98% of the average. “El Nino is strong and we have factored this into our forecast,” Bloomberg quoted the Skymet Chief Executive Officer as saying.

Global rice prices are expected to increase by 10-20% as drought-inducing El Nino is likely to dampen production prospects in Asian countries, including India, Thailand, Indonesia and the Philippines.

The total Kharif crop sown area stands at 76.4 million hectares as on July 31, 2015, up about 9% from around 70.3 million hectares during the same period last year, according to the Agriculture Ministry.

South Korea Buys 30,000 Tons of NonGlutinous Brown Rice in Tender Jul 31, 2015

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South Korea's state run Agro Fisheries & Food Trade Corporation (KAFTC) has purchased 30,000 tons of non-glutinous brown rice of Chinese and U.S. origins for delivery between October 15, 2015 and February 29, 2016, according to a statement on its website.

The following table shows the tonnage and prices of the rice purchased.

KAFTC originally sought to purchase about 41,000 tons of non-glutinous rice via five tenders for which the bidding took place on July 31, 2015.

It will announce the results for the remaining 11,000 tons of non-glutinous brewers milled rice after the sample tests.

Government of Nigeria Urged to Withdraw Waivers on Rice Importation Jul 31, 2015

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The Senate has urged the Federal government of Nigeria to withdraw all waivers on rice importation in order to encourage production in the country, according to local sources.

It noted that waivers and concessions in the recent years have led to huge quantities of rice imports and eroded the government's rice production policy.

The Senate also emphasized that the government has been losing about N71 billion (around $356 million) annually due to duty waivers on importation of rice and other agricultural products. It also stressed on the need to recover all duties due to the government.

It set up a nine-member committee to look into all waivers, concessions and grants. The committee is also responsible for reviewing policies to recover all government revenues and block leakages.

The President of the Senate noted that the government needs to focus on increasing selfsufficiency in rice and other agriculture products rather than relying on imports. He added that the newly set up committee will ensure that every penny owed to the government will be recovered.

Earlier this year, some importers were alleged to have exceeded the import quotas allocated to them under a new rice policy introduced in May 2014. Under the policy, the government allows for a preferential import duty of 10% and a levy of 20% against an import duty of 10% and levy of 60% for foreign firms in order to encourage investment in local rice production and milling.

However, nearly five foreign importing companies have together exceed their import quota by 70%. The accused importers have been asked to pay back the extra amount to the government.

Recently, the government resorted to closing down of some warehouses that pertained some importers who have been evading taxes.

Indian Researchers Identify Rice Varieties for Diabetic Patients, Says Minister Jul 31, 2015

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The Indian Institute of Rice Research (IIRR) under the Indian Council of Agricultural Research (ICAR) has identified three varieties of rice that are suitable for diabetic patients, according to local sources.

The Minister of State for Agriculture told the Upper House of Parliament that rice varieties with glycemic index value equal to or lower than 55 are considered suitable for diabetic patients. He noted that the IIRR Hyderabad has identidied three varieties - Lalat (GIS.17), BPT 5204 (GIQ.42) and Sampada (GIQ) - as having low glycemic values.

He also added that these three varieties are being cultivated in different states in India.

Indonesia 2015 Paddy Production May Fall Below Estimate, Says Agriculture Ministry Official Jul 31, 2015

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The government of Indonesia is expecting the country's 2015 paddy rice output at around 75.2 million tons, slightly below the 75.5 million tons, estimated by the statistics agency, Bloomberg quoted the Secretary General at the Agriculture Ministry.

Extending drought conditions as said to have affected around 111,000 hectares of rice planted area and around 8,900 hectares of cultivated land may see a failed harvest, according to the official. Around 14 million hectares of land is planted with rice, said the official.

The government has allocated around 2.8 trillion Rupiah (around $208 million) to support rice sector. With the allocated funds, the government is planning to develop water supply for drought-affected areas.

UPDATE: Iraq Bought 142,000 Tons of Rice from Argentina, Uruguay Jul 31, 2015

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Iraq has bought 142,000 tons of rice from Argentina and Uruguay, inlcuding: 30,000 tons from Uruguay at $605 per ton 30,000 tons from Argentina at $602 per ton 30,000 tons from Argentina at $603 per ton 52,000 tons from Argentina at $608.85 per ton

Oryza Overnight Recap – Chicago Rough Rice Futures Continue to Show Strength as Cash Market Appears to be Tightening Jul 31, 2015

Chicago rough rice futures for Sep delivery are currently seen trading 10.5 cents per cwt (about $2 per ton) higher at $11.540 per cwt (about $254 per ton) during early floor trading in Chicago.

The other grains are seen trading mixed this morning; soybeans are currently seen trading about 0.4% lower, wheat is listed about 1% higher and corn is currently noted about 0.1% higher.

U.S. stocks opened mildly higher on Friday, the final day of trade for July, as investors digested data and soft energy earnings. Crude oil traded lower near $48 a barrel. The energy sector fell about 1.5% as the only declining sector in the S&P 500. The employment cost index disappointed analysts with a rise of 0.2%, below expectations of 0.6%.The Federal Reserve left interest rates unchanged after the conclusion of its July meeting on Wednesday. The statement indicated a more optimistic outlook on U.S. economic growth, but second-quarter GDP missed expectations on Thursday, while first-quarter GDP was revised from negative to slightly positive.

Other data scheduled for release include the July Chicago PMI and the final University of Michigan consumer sentiment survey, at 9:45 a.m. ET and 10:00 a.m. respectively. Overseas, European stocks traded narrowly mixed. The Greek stock exchange is set to reopen on Monday.

The Dow Jones Industrial Average traded up 13 points, or 0.07%, at 17,757. The S&P 500 traded up 3 points, or 0.13%, at 2,111, with utilities leading nine sectors higher and energy the only decliner. The Nasdaq traded up 12 points, or 0.24%, at 5,140. Gold is currently trading about 0.9% higher, crude oil is seen trading about 0.4% lower, and the U.S. dollar is currently trading about 1.2% lower at 9:00am Chicago time.

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Oryza Weekly: Global Rice Prices Expected to Surge on Concerns of Lower Asian Supplies Jul 31, 2015

The Oryza White Rice Index (WRI), a weighted average of global white rice export quotes, ended the week at about $397 per ton, down about $7 per ton from a week ago, down about $8 per ton from a month ago and down about $86 per ton from a year ago.

The El Nino weather phenomenon associated with drought and low rainfall in Asia is likely to lower prospects of production in Asian countries, including India, Thailand, Indonesia and the Philippines. Global rice prices, which have fallen significantly since the beginning of this year

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due to increased supplies and lower demand, are expected to surge 10-20% by the end of this year on concerns of a fall in production.

Thailand Thailand 5% broken rice is today shown at about $370 per ton, down about $10 per ton from a week ago, unchanged from a month ago and down about $65 per ton from a year ago.

Thailand’s government has postponed an auction for 1.29 million tons of sub-standard rice, moving the auction from early July to August, in order to allow officials to conduct the rice separation process thoroughly.

Meanwhile, the government has struck preliminary deals to export about 760,000 tons of stockpiled rice to African nations, including Mozambique, Nigeria, and South Africa.

Separately, the government of Thailand plans to extend support to Brunei to help the country achieve self-sufficiency in rice production.

Vietnam Vietnam 5% broken rice is today shown at about $340 per ton, down about $10 per ton from a week ago, down about $15 per ton from month ago and down about $130 per ton from a year ago.

During the period January 1 - July 23, Vietnam exported about 2.926 million tons of rice, down about 19% from the first seven months of 2014.

The UN’s FAO forecasts Vietnam’s 2015 rice exports are around 6.3 million tons, down slightly from last year’s below-average level of 6.5 million tons.

Rice exporters in Cambodia are concerned about losing market share in the EU if the EUVietnam Bilateral Free Trade Agreement is finalized.

India India 5% broken rice is today shown at about $390 per ton, unchanged from a week and a month ago, and down about $50 per ton from a year ago.

Total area planting to India's 2015-16 Kharif (main) rice crop (June - December) stood at around 22.8 million hectares as of July 31, 2015, up about 6% from around 21.5 million hectares planted

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during the same time last year. Improved monsoons are said to be providing support to the ongoing kharif rice planting.

The Indian Institute of Rice Research (IIRR) under the Indian Council of Agricultural Research (ICAR) has identified three varieties of rice - Lalat (GIS.17), BPT 5204 (GIQ.42) and Sampada (GIQ) - that are suitable for diabetic patients.

The Bangladesh Tariff Commission (BTC) urged the government to maximize the use of rice bran in order to increase the edible oil production in the country.

Pakistan Pakistan 5% broken rice is today shown at about $355 per ton, down about $25 per ton from a week ago, down about $30 per ton from a month ago and down about $90 per ton from a year ago.

In FY 2014-15, Pakistan exported about 3.93 million tons of rice, an increase of about 6% from FY 2013-14, according to preliminary data from the Pakistan Bureau of Statistics.

Central & South America Brazil 5% broken rice is today shown at about $500 per ton, unchanged from a week ago, down about $50 per ton from a month ago and down about $165 per ton from a year ago.

The Brazilian paddy rice index maintained by CEPEA reached around 33.71 real per 50 kilograms as of July 27, 2015, up about 0.30% from around 33.60 real per 50 kilograms recorded on July 20, 2015.

In terms of USD per ton, the index reached around $203 per ton on July 27, 2015, down about 3% from around $209 per ton recorded on July 20, 2015.

Argentina has exported about 99,279 tons in the first four months of 2015 (January-April), a decrease of about 53% from the same period in 2014, according to the Ministry of Agriculture.

Five percent broken rice from Uruguay and Argentina is today shown at about $540 per ton, unchanged from a week ago, down about $25 per ton from a month ago, and down about $85 per ton from a year ago.

Bloomberg reports that Iraq has bought 112,000 tons of rice from Argentina and Uruguay.

Rice paddy production in Mexico is projected to be little changed y/y at about 240,000 tons in the 2015-16 marketing year (October-September).

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U.S. U.S. 4% broken rice is today shown at about $475 per ton, unchanged from a week ago, up about $20 per ton from a month ago and down about $80 per ton from a year ago.

High night time temperatures, along with bacterial panicle blast, are reportedly threatening rice production in the state of Arkansas.

Japan plans to propose a 70,000 ton tariff-free rice import quota for the U.S. in efforts to expedite the Trans-Pacific Partnership (TPP) negotiations that have been stalled due to an impasse between the U.S. and Japan over access to Japan’s rice market and U.S. tariffs on automotive parts.

Other Markets The Myanmar Agribusiness Public Company Limited will export 3,000 tons of rice to China as part of the 100,000 tons to be exported under a memorandum of understanding signed between the Myanmar Rice Federation and China’s National Cereals, Oils and Foodstuffs Corporation.

Cambodia’s Commerce Ministry will invest about $450,000 as a one-time seed capital in the country’s rice sector to help boost exports.

The Philippine Atmospheric, Geophysical and Astronomical Services Administration (Pagasa) has warned that the El Nino phenomenon, which started as a weak one in March and turned moderate in June, is heading to the most intense stage by October.

South Korea's state run Agro Fisheries & Food Trade Corporation (KAFTC) has purchased 30,000 tons of non-glutinous brown rice of Chinese and U.S. origins for delivery between October 15, 2015 and February 29, 2016.

The government of Indonesia is expecting the country's 2015 paddy rice output at around 75.2 million tons, slightly below the 75.5 million tons, estimated by the statistics agency, due to extending drought conditions in the country.

During the period September 1, 2014 to July 21, 2015, Italy has exported about 113.068 tons of milled rice, up about 3.8% from the same period last year.

Milled rice production in Russia is expected to increase to around 700,000 tons in MY 2015-16 (Jan-Dec 2016), up from an estimated 682,000 tons in MY 2014-15, according to the USDA Post.

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The government of Iran has extended its deadline for registration of rice, milling wheat, vegetable oil, and raw sugar importers until August 17 (the previous deadline was August 6).

The Senate has urged the Federal government of Nigeria to withdraw all waivers on rice importation in order to encourage production in the country.

The Ebola virus is still affecting West Africa’s agricultural activities, and rice production in Sierra Leone is expected to decline because of it.

Thailand, Vietnam, Pakistan Rice Sellers Lower Some of Their Quotes Today; India Rice Quotes Unchanged Jul 31, 2015

Thailand rice sellers lowered their quotes for 5% broken rice and Hommali rice by about $5 per ton each to around $365-$377 per ton and $860-$870 per ton respectively today. Vietnam rice sellers lowered their quotes for 5% broken rice and 100% broken rice by about $5 per ton each to around $335-$345 per ton and $310-$320 per ton respectively. Pakistan rice sellers lowered their quotes for 5% broken rice by about $10 per ton to around $345-$355 per ton. India rice sellers kept their quotes mostly unchanged.

5% Broken Rice Thailand 5% rice is indicated at around $365 - $375 per ton, down about $5 per ton from yesterday and about $30 per ton premium on Vietnam 5% rice shown at around $335 - $345 per ton, down about $5 per ton from yesterday.

India 5% rice is indicated at around $385 - $395 per ton, about $40 per ton premium on Pakistan 5% rice shown at around $345 - $355 per ton, down about $10 per ton from yesterday.

25% Broken Rice Thailand 25% rice is shown at around $350 - $360 per ton, about $25 per ton premium on Vietnam 25% rice shown at around $325- $335 per ton.

India 25% rice is indicated at around $350 - $360, about $35 per ton premium on Pakistan 25% rice shown at around $315 - $325 per ton.

Parboiled Rice

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Thailand parboiled rice is indicated at around $380 - $390 per ton. India parboiled rice is indicated at around $375- $385 per ton, about $40 per ton discount to Pakistan parboiled rice was last shown at around $415 - $425 per ton.

100% Broken Rice Thailand broken rice, A1 Super, is indicated at around $320 - $330 per ton, about $10 per ton from premium on Vietnam 100% broken rice shown at around $310 - $320 per ton, down about $5 per ton from yesterday. India's 100% broken rice is shown at around $305 - $315 per ton, about $20 per ton premium on Pakistan broken sortexed rice shown at around $285 - $295 per ton.

Oryza Afternoon Recap - Chicago Rough Rice Futures Finish the Week on a Positive Note as Technicals Point to Bullish Trend Jul 31, 2015

Chicago rough rice futures for Sep delivery settled 8 cents per cwt (about $2 per ton) higher at $11.515 per cwt (about $254 per ton). The other grains finished the day mostly lower, with wheat being the only component to manage a higher close; Soybeans closed about 1% lower at $9.4025 per bushel; wheat finished about 0.6% higher at $4.9925 per bushel, and corn finished the day about 0.7% lower at $3.8125 per bushel.

U.S. stocks traded in a range Friday, the final day of trade for July, as investors digested energy earnings misses and soft data that could push an initial rate hike further out. The Nasdaq held higher, while the S&P 500 Dow Jones industrial average struggled to climb out of negative territory as declines in energy stocks weighed. The major averages are on track for weekly and monthly gains, with the Nasdaq outperforming. The employment cost index disappointed analysts with a rise of 0.2%, the smallest increase in 33 years and below expectations of 0.6%.The Federal Reserve left interest rates unchanged after the conclusion of its July meeting on Wednesday.

The statement indicated a more optimistic outlook on U.S. economic growth, but second-quarter GDP missed expectations on Thursday, while first-quarter GDP was revised from negative to slightly positive. In other economic news, the Chicago PMI came in at 54.7 for July, the highest since January. The Dow Jones Industrial Average traded down 32 points, or 0.18%. The S&P 500 traded down 1 point, or 0.04%, at 2,107, with utilities leading five sectors higher and energy the greatest decliner. The Nasdaq traded up 9 points, or 0.17%, at 5,137. Gold is trading about 0.7% higher, crude oil is seen trading about 2.6% lower, and the U.S. dollar is seen trading at about 0.5% lower at about 1:00pm Chicago time.

Thursday, there were 1,775 contracts traded, up from 606 contracts traded on Wednesday. Open interest – the number of contracts outstanding – on Thursday increased by 208 contracts to 8,839.

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