Home Argentina market Rain puts Delta farmers behind on planting – AgFax

Rain puts Delta farmers behind on planting – AgFax

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Plantation of rice. Photo: University of Arkansas

The planting in Arkansas is not going as planned. The weather played an adverse role this year, preventing typical seedling progress. As of April 25, the USDA crop progress report said Arkansas was 14% of normal, compared to 41% planted at this time last year and a 5-year average of 48%. The weather is not favorable this week either, but there is still time to recover.

Mississippi also lags behind, registering 25% this week, down from 45% last year and a 5-year average of 41%. Louisiana and Texas are progressing well, both at par with 80% and 77% respectively. Emergence in Louisiana and Texas is also strong, showing 70% and 61% emergence, while Arkansas is only 6% against an average of 21% and Mississippi at 7% against an average by 20%.

On the ground, new crop contracts in Texas are around $1/cwt over September futures for high-grade rice and half that for other varieties. In Arkansas, prices register at $15.50/$16.25. The milled rice trade hasn’t been exciting and there doesn’t seem to be much on the horizon.

Rice milled in the United States is still quoted at over $670 pmt, while other Western Hemisphere players come in at $555 pmt in Brazil, $540 pmt in Uruguay and $545 pmt in Uruguay.

A NASS GAIN report on Argentina was released this week showing production expected to be 780,000 tonnes on a milled basis, or 2 million gross tonnes, planted from 432,000 acres. Planting is scheduled for August and, as of publication, the drought is not expected to ease, so the acres will look like last year.

The situation here is much like the mid-grain market in California, where river and reservoir levels are at record highs, hampering normal planting decisions. Add to that the global spike in fertilizer prices, it will be difficult to maintain rice acreage where drought is rife.

Exports are expected to fall to 340,000 tonnes from 370,000 tonnes last year. The big wild card will be Brazil, as it is expected to import large quantities from its neighbors due to their drought.

In Asia, the story is the same too. India maintains a price cap, stable in the price range of $355-360 pmt. Thailand moved higher this week, up to $430 pmt from $410 pmt a week ago. Vietnam is tied with last week at $415 pmt.

To be seen in the coming months, the impacts of the increase in fuels and fertilizers for these historically cheap production regions. The extents of the conflict between Russia and Ukraine are still being uncovered, and the repercussions will be felt for months in the food supply chain.

USDA’s weekly export sales report shows net sales of 16,400 MT this week, down 75% from the previous week and 53% from the previous 4-week average. The increases were mainly in Japan (12,000 MT), Canada (1,400 MT), Costa Rica (1,000 MT), Mexico (900 MT) and Argentina (300 MT).

Exports of 88,800 MT were significantly up from the previous week and up 84% from the previous 4 week average. The destinations were mainly Mexico (31,400 MT), Colombia (30,800 MT), Japan (12,000 MT), Costa Rica (11,000 MT) and Canada (2,300 MT).

In the futures market, the stock rose in price, possibly due to slow planting in Arkansas, a potentially shorter crop. Average daily volume was 1,205, down 41%, and open interest was 10,417, about the same as last week.