March 11, 2015

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Volume 5, Issue I
Daily Exclusive

ORYZA Rice
Newsletter

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Vietnam Plans to Develop Specialized Rice

Growing Areas in Mekong Delta
Mar 10, 2015

The Ministry of Agriculture and Rural Development (MARD) of Vietnam is planning to develop
specialized large-scale rice growing areas in the Mekong River Delta (MRD) region to cater to
the growing needs of local and international markets, according to local sources.
An official from the Department of Plant Cultivation under the Ministry told local sources that
the five areas include the Ca Mau Peninsula, the Tay Song Hau (western Hau River) area, the Tu
Giac Long Xuyen region, alluvia soil along the Tien and Hau Rivers, and the Dong Thap Muoi
region. He noted that specific rice varieties suitable to the existing weather conditions would be
grown in these areas to ensure high-quality and yields.
The MRD region currently has around 100,000 hectares of large-scale rice area and the Ministry
is planning to enhance it to around 800,000 hectares by 2020. According to data from the
General Statistics Office (GSO) in Vietnam, the total rice area in the MRD is around 4.2 million
hectares, about 54% of the country's rice area of around 7.8 million hectares.

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Meanwhile, about 128 businesses purchased about 8% or around 79,360 tons of rice under the
government's stockpiling program to purchase and stockpile one million tons of rice from the 2014-15
winter-spring harvest, according to the General Director of the state-owned VinaFood 2. The government
approved the stockpiling scheme to protect prices from falling during the harvest season. However, the
program could not provide the desired results in the past due to several constraints like inadequate storage
facilities and lack of finance

Vietnam Deputy Trade Minister Foresees

Surge in Rice Exports in 2015
Mar 10, 2015

The Vietnamese Deputy Minister for Industry

and Trade has expressed optimism that
Vietnam's rice exports, which declined about
4% y/y to around 6.4 million tons in 2014, to
rebound in 2015 backed by increased demand
from China and lower export prices, according
to Bloomberg.The Deputy Minister expects rice
exports to pick up from the second quarter.
However, competition with Thailand is
expected to limit the increase in 2015 exports to
below 10%, he said. He noted that Thailand would remain the largest exporter in 2015 with
about 11 million tons.
Though Thailand is a competitor for Chinese rice, the Minister noted that noted that Vietnam has
several advantages such as competitive prices, suitable varieties and geographic proximity with
China compared to Thailand. The Chinese market will definitely become active again after
quiet periods late 2014 and early this year, he said.Vietnam's rice prices have been declining
since the beginning of this year due to increased supplies from the ongoing winter-spring harvest
and reduced export demand. Though Thailand's prices are currently higher than those of India
and Pakistan, they are expected to decline due to the increased sales of the stockpiled rice,
according to the Thai Rice Exporters Association (TREA). Currently, Vietnam 5% rice is quoted
at around $370 per ton compared to the Thai 5% rice and India 5% rice at around $400 per ton
and around $395 per ton respectively.
Vietnam exported around 515,000 tons of rice in the first two months of 2015, down about 34%
from around 690,100 tons exported during the same period in 2014, according to the Vietnam
Food Association (VFA).
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South Korea Seeks to Buy 58,897 Tons of

Non-Glutinous Rice in International Tenders
Mar 10, 2015

South Korea's state run Agro Fisheries & Food Trade Corporation (KAFTC) is seeking to buy
about 58,897 tons of non-glutinous rice in international tenders for delivery between June 30 and
September 30, 2015, according to a statement on its website.KAFTC seeks to buy 12,000 tons of
brown short-grain non-glutinous rice for delivery by June 30, 2015; 10,000 tons of brown shortgrain non-glutinous rice for delivery by June 30, 2015; 11,897 tons of brown short-grain nonglutinous rice for delivery by September 30, 2015; 15,000 tons of brown medium-grain nonglutinous rice for delivery by June 30, 2015; and 10,000 tons of brown medium-grain nonglutinous rice for delivery by June 30, 2015 in international tenders.Registration of tenders will
close at 4.00 p.m on March 23, 2015 and electronic bidding will take place on March 24, 2015
between 10.00 - 11.00 a.m.KAFTC bought 44,000 tons of brown rice of the U.S. and Chinese
origins for delivery by May 31, 2015 in a tender that closed on February 25, 2015.

Oryza U.S. Rough Rice Recap - Prices Hold

Steady as USDA Decreases Ending Stocks
Mar 10, 2015

The U.S. cash market was unchanged today despite a slightly neutral to bullish WASDE report
as both buy and sell interest remains limited at the current level.
Todays USDA WASDE report showed a 1.0 million cwt (45,359 tons) increase in U.S. long
grain exports based on expectations for increased exports in the Western Hemisphere.
This in turn decreased U.S. long grain ending stocks by the same amount putting their 2014/2015
carry over projection at 27.1 million cwts (1,229,237 tons), the largest figure since 2010/2011.
The USDA also increased their average farm price projection by $0.30 per cwt (about $7 per ton)
bringing the range to $12.20-$12.80 per cwt (about $267-$282 per ton).

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Some analysts took issue with the USDAs call for greater exports because if the dollar continues
to firm it will make U.S. origin rice less attractive to some destinations.

Brazil Paddy Rice Index Declines Slightly

from Last Week
Mar 10, 2015

The Brazilian paddy rice index maintained by the Center for Advanced Studies on Applied
Economics (CEPEA) reached around 36.02 real per 50 kilograms as of March 09, 2015, down
about 0.3% from around 36.13 real per 50 kilograms recorded on March 02, 2015.In terms of
USD per ton, the index reached around $232 per ton on March 09, 2015, down about 8% from
around $252 per ton recorded on March 2, 2015.

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Economies of Scale Consolidate Arkansas

Rice Farms
Mar 10, 2015

Rice farmers in the Arkansas state of the U.S. are finding it more economical to grow rice on
larger farms rather than on smaller firms given the huge operating costs associated with rice
cultivation, according to Arkansas Business.
According to USDA, average size of rice farms grew about 63% from around 111 hectares in
1992 to around 181 hectares. The data also shows that the number of rice farms with over 400
hectares have more than doubled during the period to around 616 from 292. The result is that
smaller size farms have reduced significantly.Accordingly, while the number of rice farms in the
U.S. declined by about 46% during the period, the overall rice acreage declined only 12%.
Effectively, a lot of expansion has happened to derive maximum economies of scale.
The USDA data shows that per hectare operating costs for rice averaged to around $1,038
between 2006-2009 compared to $607 for corn and $274 for soybeans. The data also shows that
rice is the most profitable crop compared to corn and soybeans. Average per hectare turnover for
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rice was around $2,119 during the above-stated period compared to around $1,136 for corn and
around $882 for soybeans.Also, a typical rice farm needs nearly $2.5 million for farming
equipment, which is constant irrespective of farm size. So, farmers have started expanding the
size of the farms significantly to take advantage of the economies of scale. Larger the farm,
lesser costs, greater the income and profits.
Arkansas is the top rice producing state in the U.S. contributing to over 40% of total U.S. rice
production. According to USDA data, Arkansas produced around 3.6 million tons of rice from
around 430,400 hectares of rice area in 2013.

Global Rice Quotes

March 10th, 2015
Long grain white rice - high quality
Thailand 100% B grade 410-420
Vietnam 5% broken
365-375
India 5% broken
390-400
Pakistan 5% broken
345-355
Myanmar 5% broken 415-425
Cambodia 5% broken 425-435
U.S. 4% broken
480-490
Uruguay 5% broken
NQ

Argentina 5% broken NQ

Long grain white rice - low quality

Thailand 25% broken 365-375
Vietnam 25% broken 345-355
Pakistan 25% broken 310-320
Cambodia 25% broken 410-420
India 25% broken
355-365
U.S. 15% broken
470-480

Long grain parboiled rice

Thailand parboiled 100% stxd 400-410

Pakistan parboiled 5% broken stxd

395-405
India parboiled 5% broken stxd 385-395

U.S. parboiled 4% broken

555-565

Brazil parboiled 5% broken

570-580

Uruguay parboiled 5% broken NQ

Long grain fragrant rice

Thailand Hommali 92%
920-930
Vietnam Jasmine
465-475

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India basmati 2% broken
NQ
Pakistan basmati 2% broken
NQ
Cambodia Phka Mails 790-800

Brokens
Thailand A1 Super
325-335

Vietnam 100% broken 310-320

Pakistan 100% broken stxd

280-290
Cambodia A1 Super
345-355

India 100% broken stxd

280-290
Egypt medium grain brokens NQ

U.S. pet food 380-390

Brazil half grain

NQ

All prices USD per ton, FOB vessel, oryza.com

Asia Rice Quotes Mixed Today

Mar 10, 2015

Thailand rice sellers lowered their quotes for 5% broken rice by about $5 per ton to around $395
- $405 per ton and increased their quotes for 100% broken rice by about $5 per ton to around
$325 - $335 per ton today. Vietnam rice sellers lowered their quotes for 5% broken rice and
100% broken rice by about $5 per ton each to around $365 - $375 per ton and around $310 $320 per ton respectively, and increased their quotes for Jasmine rice by about $10 per on to
around $465 - $475 per ton. Pakistan rice sellers lowered their quotes for 100% broken rice by
about $10 per ton and increased their quotes for 5% broken rice, 25% broken rice and Parboiled
rice by about $5 per ton each. India rice sellers kept their quotes unchanged today.
5% Broken Rice
Thailand 5% rice is quoted at around $395 - $405 per ton, down about $5 per ton from yesterday
and about $30 per ton premium on Vietnam 5% rice shown at around $365 - $75 per ton, down
about $5 per ton from yesterday. India 5% rice is quoted at around $390 - $400 per ton, about
$45 per ton premium on Pakistan 5% rice quoted at around $345 - $355per ton, up about $5 per
ton from yesterday.
25% Broken Rice
Thailand 25% rice is quoted at around $365 - $375 per ton, about $20 per ton premium on
Vietnam 25% rice shown at around $345- $355 per ton. India 25% rice is quoted at around $355

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- $365, about $45 per ton premium on Pakistan 25% rice quoted at around $310 - $320 per ton,
up about $5 per ton from yesterday.

Parboiled Rice
Thailand parboiled rice is quoted at around $400 - $410 per ton. India parboiled rice is quoted at
around $385 - $395 per ton, about $10 per ton discount to Pakistan parboiled rice quoted at
around $395 - $405 per ton, up about $5 per ton from yesterday.
100% Broken Rice
Thailand broken rice, A1 Super, is quoted at around $325 - $335per ton, up about $5 per ton
from yesterday about $15 per ton premium on Vietnam 100% broken rice shown at around $310
- $320per ton, down about $5 per ton from yesterday. India's 100% broken rice is shown at
around $280 - $290 per ton, on par with Pakistan broken sortexed rice quoted at around $280 $290 per ton, down about $10 per ton from yesterday.

About 915,429 Tons of Italy's 2014-15 Paddy

Crop Sold as of March 3, 2015; Up 11% from
Last Year
Mar 10, 2015

Around 631,058 tons, or about 64.82% of total Italian 2014-15 (September 2014 - August 2015)
paddy crop has been sold out as of March 3, 2015, up about 11% from around 826,943 tons sold
during the same period last year, according to data from the Ente Nazionale Risi, the National
Agency for Rice.
Around 400,158 tons of Long-A varieties; 264,989 tons of Long-B varieties; 229,520 tons of
round paddies and 20,762 tons of medium varieties have been sold since the beginning of this
crop year. Loto-Ariete, with 139,644 tons and Arborio-Volano, with 61,230 tons, Baldo with
57,359 and Roma with 24,258 tons remained the best sold varieties year to date.

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During the week February 24, 2015 - March 3, 2015, a total of around 27,700 tons of paddy were
sold. The week's sales included about 11,682 tons of Long A, about 8,559 tons of Long B, about
7,189 tons of round paddy and 270 tons of medium paddy. Loto-Ariete, with 5,706 tons and
Arborio-Volano, with 2,385 tons remained the best sold varieties during the week.
A total of around 1.412 million tons of paddy are available as beginning stocks for 2014-15,
down about 4% from around 1.466 million tons available last year. Around 496,900 tons or
about 35.18% of total stocks are yet to be sold.

Prices of all varieties remained stable or increased since the last week of November 2014 due to
adequate supplies and sales.Italian 2014-15 paddy crop harvest began on September 1, 2014 and
is almost complete, according to official sources. Farmers had to face challenges such as average
low temperatures, damp weather and scanty rainfall during the planting and growth stages in
summer, according to local sources. They are also worried about falling rice prices due to
increasing rice imports from the Least Developed Countries (LDCs) under the Everything but
Arms (EBA) agreement.

Italian Rice Project Revisits Ancient Roman

Tradition
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Mar 10, 2015

Italian rice community is all charged up for the International Expo 2015, which will take place in
Milan from May 1 to October 31, 2015. If some artist is taking the opportunity to design a roof
top terrace on a commercial complex in Milan, some others are planning to use the event to
promote rice dishes in European school canteens.The rice estate Tenuta Colombara in the Italian
town Vercelli and global food chain Slow Food International are planning to use the ancient
Roman tradition "Gioved gnocchi" (On Thursday potato dumplings), which encouraged people
in Rome to cook potatoes on Thursdays, in European schools through a project called "On
Wednesday? Rice".
The project aims at convincing all the European schools to serve rice to its students at least once
a week, i.e., on Wednesdays.The project also encourages school children to participate in a rice
culinary competition. Students attending 4th year of primary schools in Europe can send in their
recipes to the Jury before April 15, 2015 and final selected recipes will be cooked in the farms of
Tenuta Colombara located in Livorno Ferraris. Winning class will also have the privilege of
attending the expo in October 2015.

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Indonesia President Rules Out Rice Imports

Despite Continuing Price Hikes

Mar 10, 2015

The Indonesian President has ruled out rice imports despite continuing price hikes and pressure
from related departments, according to local sources.The President was quoted as saying that he
discourages imports though they can immediately stabilize prices. He noted that the current rice
stocks with the state logistics agency Bulog reached around 1.7 million tons and has expressed
an optimism of receiving a good output from the ongoing harvest by March.
The government began operations for distributing Bulog rice in the market on February 25, 2015
for controlling price hikes. The President apprised local sources that the government so far
distributed 400,000 tons of rice. A few days back he noted that stocks would be sufficient despite
a rise in demand.He also noted that prices have started reversing in the Cipinang market and
hoped to see further price falls. He called on the rice farmers to work towards increasing rice
yields to maintain adequate stocks. e said the government would support them with adequate
facilities and infrastructure, including irrigation systems, tractors, rice-planting machines,
combine harvesters, and seeds.

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Average rice prices have been increasing since September 2014. Currently, average rice prices
stand at around 9.94 million rupiah (around $780 per ton).The Director General of
the Agriculture Ministry is expecting the harvest from the ongoing crop season at around 13.2
million tons, basis paddy. Indonesia's 2015 paddy rice production is expected to reach about
71.28 million tons, up about 0.95% from around 70.6 million tons produced in 2014.USDA
estimates Indonesia to import around 1.3 million tons of rice in MY 2014-15 (October September). The UN's FAO estimates Indonesia to import 1.2 million tons of rice in 2014-15
(April - March).Separately, the Social Affairs Ministry has announced its plans to improve the
national rice for the poor (raskin) program in line with the government's efforts to overcome rice
shortages and possible corruption in the scheme.

Indian Exporters Expect Iran to Resume

Basmati Rice Imports Soon
Mar 10, 2015

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Indian exporters' associations, including the Federation of Indian Exports Organisation (FIEO)
and the Agricultural & Processed Food Products Export Development Authority (APEDA) are
expecting Iran to resume basmati rice imports from India after the new financial year begins in
April 2015, according to local sources.Iran is a major destination for India's basmati rice exports
and accounts for nearly 40% of India's total basmati rice exports. The Middle East nation had
temporarily banned rice imports in November 2014 as it was holding excess stocks from last
year's imports as well as a bumper crop in 2014. The UN's Food and Agriculture Organization
(FAO) estimated Iran's 2014 rice output at around 3 million tons, up about 3% from around 2.9
million tons in 2013.
Iran imported around 1.44 million tons of rice in 2013-14, up about 33% from around 1.08
million tons imported in 2012-13. India's basmati rice exports to Iran were primarily impacted
due to Iran's stance to revise the accepted level of arsenic content in basmati rice from 150 parts
per billion (ppb) to 120 ppb in March 2014. Later in September 2014, Iran also increased import
duty on basmati rice from 22% to 45% before banning rice imports in November 2014.
India exported around 706,665 tons of basmati rice to Iran in the first nine months of FY 201415 (April - December), according to APEDA. At this pace, rice market analysts expect India's
basmati rice imports to Iran to decline by about 15-20% to around1.15 - 1.2 million tons in
2014-15.
The Director General of the FIEO told local sources that the Iran authorities are likely to lift the
ban and start issuing permits to Indian exporters soon. Once Iran issues import permits, India
would commence basmati rice exports to Iran, added the Director of the APEDA. Iranian
officials have indicated that they will resume the process of re-registration of Basmati suppliers.
The country is supposed to come up with its notification (on lifting curbs) on March 21," a
Commerce Ministry official was quoted as saying earlier.
India exported around 2.57 million tons of basmati rice in April - December 2014, down about
6% from around 2.74 million tons exported during the same period in 2013-14. India exported
around 3.76 million tons of basmati rice in 2013-14, up about 9% from around 3.46 million tons
in 2012-13, according to data from APEDA.

An organization, no matter how well designed, is only

as good as the people who live and work in it.
Dee Hock
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