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USDA Grains: World Markets and Trade

11 April 2012

USDA Grains: World Markets and Trade April 2012USDA Grains: World Markets and Trade April 2012

Global trade for rice is down, wheat up and coarse grains mainly unchanged.
USDA Grains: World Markets and Trade Reports

Rice: India and Vietnam Supplant Thailand

For the first time in nearly 50 years, Thailand is forecast to lose its position as the world’s top rice exporter, supplanted by India AND Vietnam. Thailand’s fall to number three has nothing to do with s upp ly, however, as the country expects a record crop. The declining exports are due to a government purchasing program that keeps prices high. The irony is that while Thai rice is entering warehouses for long-term storage, India’s rice is finally leaving them. The huge stocks amassed during nearly 4 years of banning non-basmati rice exports have enabled traders to greatly undercut government-supported Thai prices. When India re-entered the market, Vietnam dropped its prices to compete. However, these market shifts, largely driven by government policies, could change as they have in the past. Or importing countries could purchase more and push global demand to a point where the Thai stocks are needed despite their higher cost.



Global trade for 2011/12 is up this month and forecast at a record. Trade is higher primarily because of strong demand for wheat for feeding. U.S. exports are raised on recent sales. The forecast U.S. season-average farm price is unchanged and remains a record.


Hard Red Spring (HRS) was up $4 to $370 per ton following the release of USDA’s Prospective Plantings report that showed spring wheat plantings to be lower than expected. Winter wheat prices were lower based on generally good crop conditions. Hard Red Winter (HRW) tumbled $8 to $299 per ton. Soft Red Winter (SRW) was down $4 to $268 per ton. Soft White Wheat (SWW) fell $7 to $265 per ton, dipping below SRW.



Forecast global trade is down 2.0 million tons from last year but still the second highest on record. Exporters India and Vietnam both surpass Thailand for the first time ever, and Indonesia, China, and the EU-27 boost imports. U.S. exports are down slightly year-to-year but up marginally from last month.


Much is expected to change for the top six exporters of 2011. In 2012, India shoots from number three to number one as traders race to sell huge stocks of non-basmati rice. Pakistan recovers from the flood and boosts shipments. Vietnam maintains its 2011 record and ties India for number one. U.S. rice struggles to compete with so many lower-priced options. The Thai paddy pledging scheme pushes Thailand from its reign of nearly 50 years all the way to number three, and Brazil plummets from its 2011 record due, in part, to a much smaller crop.



Global coarse grains are mostly unchanged for both trade and production. Mexico’s corn imports are boosted to a record. China corn consumption is lowered, based on indications of higher wheat feeding. U.S. corn exports and season-average farm price are unchanged.


In anticipation of USDA quarterly grain stocks information, U.S. corn export quotes shed $15/ton until month’s end. However, by early April, they recovered, ending $2/ton higher than at the time of the March WASDE release.

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