World Grain - March 2023 - 22

GRAINMARKET REVIEW
Rice monthly price
(in US dollars per tonne)
RICE
Lunar New Year slows rising rice market
by Chris Lyddon
The Lunar New Year took the edge off a previously bullish
rice market, slowing down sales in late January, after prices
started the year with rises.
In its Grain Market Report of Feb. 16, comparing with its
previous report, which was published on Jan. 12, the International
Grains Council (IGC) said " with activity curtailed
by Lunar New Year celebrations, average international rice
prices were little changed month-on-month amid offsetting
movements across key exporters. "
" In Thailand, export values for 5% broken retreated by $23,
to $460 fob Bangkok, as early gains, linked to currency movements
and the covering of previously agreed sales, were later
more than reversed by weak buying interest, " the London,
England-based IGC said. " In Pakistan, initial support from
rising local values was likewise countered by pressure from
slow international demand, while Vietnamese 5% broken
firmed as traders awaited fresh supplies from the upcoming
winter/spring harvest.
" Indian 5% broken offers were $15 higher, at $433 fob
Kakinada, amid steady buying interest and solid government
procurement. "
The US Rice Producers Association, in its Rice Advocate
publication of Feb. 17, noted a USDA attaché report highlighting
the continued drought in South America.
" With approximately 10% of the harvest complete, it is expected
that farmers have been forced to abandon approximately
50,000 acres of rice on account of the drought in Corrientes
and Entre Rios, " the USDA said. " Rainfall in 2022 was only
half of the annual average, so producers who planted hoping
for rain and surface water were sorely disappointed.
" This will ultimately result in a shorter exportable supply,
with key export markets like the EU, Brazil, and Chile competing
for the product. In Asia, we are seeing some price softening
in Thailand, likely a result of the second crop supply
about to hit the market. "
In its Rice Price Update of Feb. 3, the United Nations Food
and Agriculture Organization (FAO) reported that after rising
for the greater part of 2022, international rice prices opened
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Rice (Thailand), 5% broken, white rice (WR), milled, indicative
price based on weekly surveys of export transactions, government
standard, f.o.b. Bangkok.
calendar 2023 on a firm note. January's global price level was
up 6.2% from December and the highest since November
2011.
" Indica prices drove this increase, rising 6.2% over December
levels, " the FAO said. " Aromatic prices also strengthened
markedly (by 9.8%), sustained by demand for Lunar New
Year celebrations, preparative purchases for Ramadan and a
post-harvest surge in Pakistani basmati quotations.
" Low buying interest kept gains in Japonica prices comparatively
more moderate (at 0.9%), even though this January
increase placed the Japonica Index at a fresh nominal peak.
By contrast, glutinous prices eased by 2%, weighed by ebbing
Chinese glutinous demand. "
Asian quotations of Indica rice firmed across all the major
origins in January, the FAO said.
" The most pronounced gains took place in Thailand, where
the Baht strengthened to a 10-month high, adding to the sentiment
boost provided by Indonesian purchases, " the FAO said.
" In Pakistan, short supplies from a flood-reduced crop and
persistently elevated inflationary pressure were compounded
by strong local demand for rice (including brokens), as constraints
in wheat flour supplies drove consumers increasingly
toward rice. "
A further factor was that rises in currency against the US
dollar influenced prices in Brazil, Vietnam and India.
" In Vietnam, tight availabilities ahead of the winter-spring
harvest provided further underpinning, as did a record pace
of government domestic procurement in India, despite the
smaller Kharif crop harvested in 2022, " the FAO said. " In the
Americas, Iraqi purchases sustained Indica quotations in the
United States, Argentina and Uruguay. "
Chris Lyddon is World Grain's European correspondent.
He may be contacted at: cajlyddon@gmail.com
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March 2023 / World Grain / World-Grain.com
Source: USDA; World Bank
http://www.World-Grain.com
World Grain - March 2023

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