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USDA Rice Outlook

16 January 2012

USDA Rice: US 2011/12 Crop Estimate LoweredUSDA Rice: US 2011/12 Crop Estimate Lowered

This month, the 2011/12 U.S. rice crop estimate was lowered 3.1 million cwt to 185.0 million cwt, down 24 percent from the year-earlier record and the smallest U.S. rice crop since 1998/99.
USDA Rice Outlook

Production estimates were lowered for both long-grain and combined medium- and short-grain rice. The downward revisions were the result of a reduced yield estimate. Crop estimates were lowered for all States except Texas.

The smaller crop estimate resulted in a 1-percent reduction in the 2011/12 total supply forecast to 252.5 million cwt, a decline of 15 percent from a year earlier. Beginning stocks of all-rice remain calculated at 48.5 million cwt, 33 percent larger than a year earlier and the largest since 1987/88. Total U.S. rice imports for 2011/12 remain forecast at 19.0 million cwt, almost 4 percent above a year earlier.

Total domestic and residual use was lowered 3.0 million cwt to 124.0 million cwt largely based on December 1 stocks estimates and weekly millings. Exports were lowered 1.0 million cwt, largely based on shipment pace and outstanding sales. On balance, these supply and use revisions resulted in 2.5-percent increase in the 2011/12 ending stocks forecast to 38.5 million cwt, still 21 percent below a year earlier.

The 2011/12 season-average farm price (SAFP) for U.S. long-grain rice remains projected at $13.50-$14.50 per cwt, well above the $11.10 estimated for 2010/11. The combined medium- and short-grain 2011/12 U.S. SAFP is projected at $15.00-$16.00 per cwt, down 50 cents on both the high and low end from last month's forecast. The midpoint is $2.90 below the 2010/11 SAFP of $18.40 per cwt.

The 2011/12 global rice production forecast was fractionally raised this month to a record 461.6 million tons (milled basis). Production forecasts were raised for Bangladesh and Cambodia, but lowered for Brazil, North Korea, Pakistan, and the United States. Global disappearance for 2011/12 was increased fractionally to a record 458.6 million tons, with Bangladesh accounting for most of the increase. Global ending stocks for 2011/12 are projected at 100.1 million tons, up less than 1 percent from last month's forecast and the fifth consecutive annual increase in global ending stocks.

The global calendar year 2012 trade forecast was reduced almost 1.0 million tons (milled basis), from last month's forecast to 31.9 million tons, more than 8 percent less than the 2011 record. Export forecasts were lowered for both Thailand and Brazil, but raised for Cambodia. Import forecasts were lowered for the Philippines and Bangladesh.

Trading prices for Thailand's high-, medium-, and low-quality grades of specialty and non-specialty rice have declined since early December, mostly due to a lack of inquiries. Price quotes from Vietnam continued to fall over the past month as well. With Thailand largely priced out of the market, Vietnam's prices continue to decline in the face of lower priced rice from India and Pakistan. U.S. long-grain milled-rice prices continue to decline, largely in response to lower trading prices from several sources. In contrast, prices for California medium-grain milled-rice rice have increased, partly a response to recent large purchases from Northeast Asian buyers.

January 2012

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