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October 16, 2015

Vol 5.Issue XV

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Oryza Overnight Recap Chicago Rough

Rice Futures Continue to Slide as Market
Enters Technical Downtrend
Oct 15, 2015

Chicago rough rice futures for Nov delivery are currently noted 12 cents per cwt (about $3 per
ton) lower at $12.025 per cwt (about $265 per ton) during early floor trading in Chicago. The
other grains are seen trading with mixed results overnight; soybeans are currently seen trading
about 0.3% higher, wheat is listed about 0.1% higher and corn is currently noted 0.3% lower.
U.S. stocks opened slightly higher Thursday as investors digested mostly soft economic data that
supported the case for a rate hike delay. In economic news, September CPI declined 0.2%,
matching expectations. Ex-food and energy, the price index rose 0.2% for the month, following a
0.1% rise in August. Weekly jobless claims came in at 255,000. The October Empire State Index
posted a read of negative 11.36. The index showed negative 14.67 in September. The Philly Fed
index is set to be released at 10:00 a.m. In Europe, the pan-European Stoxx 600 index traded
more than 1% higher on Thursday. In Asia, Japan's Nikkei finished 1.15% higher, while in China
the Shanghai Composite closed 2.32% higher. In opening trade, the Dow Jones Industrial
Average gained 28 points, or 0.16%, to 16,947. The S&P 500 rose 6 points, or 0.3%, to 2,000,
with consumer staples leading eight sectors higher and materials and health care the only
laggards. The Nasdaq traded up 16 points, or 0.36%, at 4,799. Gold is currently trading about
0.2% higher, crude oil is seen trading about 1.4% lower, and the U.S. dollar is currently trading
about 0.6% higher at 9:00am Chicago time.

Government of Thailand Again Advises

Farmers to Avoid Off-Season Rice Planting
Oct 15, 2015

The Agriculture and Cooperatives Ministry has again advised farmers not to carry out off-season
rice planting operations as water levels in the reservoirs are still not sufficient for rice farming,
according to local sources.
The Agriculture Permanent Secretary noted that most of the rice growing regions did not receive
rains in the past few weeks. He noted that the government has been taking up rain-making

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missions to increase water levels at the four major dams - Bhumibol, Sirikit, Pasak Jolasid and
Khwae Noi Bamrungdaen.
The rain-making missions are likely to push up water levels in the reservoirs from the current
3,700 million cubic meters to around 4,400 million cubic meters in the next two weeks.
However, the water won't be sufficient for rice farming, said the Permanent Secretary. He urged
the farmers to heed to the government's advice on water conservation.
Some farmers are understood to have planted the off-season rice despite governments warnings
saying rice farming is their main means of living. Most of the farmers are debt-ridden and are
seeking support measures from the government.
The extending drought conditions are likely to lower the Thai paddy rice production to around
22.98 million tons in 2015-16, down about 30% from around 32.62 million tons last year.

Nigeria Plans to Stop Rice Imports from 2017

Oct 15, 2015

The Federal Government of Nigeria is planning to ban rice imports from 2017, according to local
sources.
The decision was taken at a meeting between the President, Governors of some rice-producing
states and the Central Bank Governor on Wednesday. The government is keen on achieving selfsufficiency in rice production and ban imports. Investments being made in rice mills across the
country are said to support the government's target.
However, the government is keen on not implementing the ban until the local rice sector is
completely developed and is capable of producing rice needed for local consumption. A similar
decision in 2013 had led to an increase in rice smuggling in the country.
All the state Governors reportedly agreed to support the Federal government's decision and work
towards increasing the rice production and food security in the country.
Nigeria is a traditional importer of rice and imports over half of the annual demand. Nigeria
produced around 2.9 million tons in 2014, about 52% higher than around 1.9 million tons
produced in 2013.
USDA estimates Nigeria to produce around 2.709 million tons of rice and import around 3
million tons of rice in MY 2015-16 (October September) to meet a consumption demand of
around 6 million tons.

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European Farmers Association Welcomes

Changes to EU Organic Farming Proposal
Oct 15, 2015

Copa-Cogeca, the European federation of farmers Unions and agri-cooperatives, has welcomed
changes to the European Union (EU) organic farming proposal after the European Parliament's
Agriculture Committee voted for the changes to the original proposal on October 14, 2015,
according to local sources.
The Secretary-General of Copa-Cogeca hailed the decision to retain the mixed farms structure so
that farmers could gradually convert to organic farming. He also expressed satisfaction over the
decision to maintain annual controls.
The MEPs of the European Parliament's Agriculture Committee however noted that the
conditions to establish a specific European declassification level for organic products are still to
be established. They told local sources that they want imports to comply with the EU production
standards in order to ensure fairer competition between EU farmers and non-EU farmers. This is
particularly important to maintain consumer confidence because both EU and non-EU products
can bear the same EU organic logo.
"We believe that organic seeds must meet the same high expectations that customers have for the
identity, performance, quality, health and traceability of non-organic seed. With this negotiating
position, MEPs can enter into negotiations with the European Council," they said.
Talks with the European Council can lead to having improved EU organic farming legislation
and thereby contribute to the development of the sector, said the MEPs. They noted that the idea
of the EU organic farming review is to ensure that the 250,000 organic farmers have pragmatic
rules that will allow them to earn a living from their activities while ensuring consumer
confidence.

Philippines Estimates 2015 Third Quarter

Paddy Production at 2.579 Million Tons
Oct 15, 2015

The Philippine Statistics Agency (PSA) estimates the Philippines paddy rice production in the
third quarter (July - September) of 2015 to decline about 14.8% to around 2.579 million tons
from around 3.03 million tons during the same period in 2014, and down from its previous
forecast of around 2.589 million tons, according to a statement on its website.

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The PSA estimates harvest area to decline about 0.2% y/y to around 656,910 hectares from
around 658,090 hectares last year. However, it estimates per hectare yield to remain unchanged
from last year's 3.93 tons per hectare.
The decline in production is attributed to insufficient water supply and extreme heat caused by
dry spell in most of the rice producing states. The incidence of stem borer in some states as well
as adverse effects of typhoons Egay and Hannah and Ineng are also responsible for decline
in production. Around 203,000 hectares of the current crop are harvested.
The local weather bureau has warned of an intensifying El Nino in the coming months, which
could potentially affect paddy output in central, southern and northern provinces. The effects of
the El Nino are expected to last till the middle of 2016. Government officials are considering the
phenomenon to be as intense as that in 1997-98, when the farm output fell by 23% and prices
increased significantly.
The government is concerned that the country's paddy rice output may not reach the targeted
20.09 million tons due to the El Nino induced drought conditions. It has already approved for
importing about 1.8 million tons of rice for delivery this year, including about 937,000 tons
already received and about 600,000 tons purchased by the private traders under the WTO rules.

Pakistan Rice Exporters Face Cost

Disadvantage in Global Market, Says REAP
Official
Oct 15, 2015

The Senior Vice-Chairman of the Rice Exporters Association of Pakistan (REAP) says Pakistan
rice exporters face a cost disadvantage in the international market due to high cost of fertilizers,
electricity and lack of research and development, according to Bloomberg.
He says the Pakistan rice trade is uncompetitive, especially in basmati varieties and due to the
above reasons, many international buyers are switching to Indian basmati rice.
Accumulating stocks from the last year, which are currently about 500,000 tons are another
cause of concern for the exporters. Arrival of stocks from the new crop are likely to add to the
woes of the exporters, he says.
Farmers are also unhappy despite getting a bumper crop this year as there are no buyers for their
paddy. Due to increasing stocks, traders are unwilling to buy paddy from farmers this year.

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Exporters have been urging the government to intervene and facilitate rice trade with traditional
as well as new markets. Farmers are also demanding for introducing a minimum support price
(MSP) for basmati paddy.
Pakistan exported around 396,199 tons of rice in the first two months of FY 2015-16 (July June), up about 14% from around 348,084 tons exported during the same period in FY 2014-15.
However, Pakistan's rice exports declined in terms of value during the said period. Pakistan
earned around $213 million during the two months of FY 2015-16, down about 7% from around
$230 million earned last year.

Increasing Supplies and Falling Consumption

May Lower Rice Prices in South Korea
Oct 15, 2015

Experts are worried that increasing supplies and falling consumption in South Korea may lead to
a decline in prices domestically, according to local sources.
Based on data from Statistics Korea, the government is expecting 2015 rice production to
increase about 0.4% y/y to around 4.25 million tons (basis milled). The increase is reportedly
higher than the average production by about 7.5%. The production is likely to increase despite a
fall in acreage by about 2% to around 799,000 hectares this year from around 816,000 hectares
last year. Acreage has been declining consistently since 2010 from around 892,000 hectares.
Meanwhile, rice consumption also has been declining since 2005. The per capita consumption of
rice has fallen to 65.1 kilograms in 2014, from 80.7 tons in 2005, according to the Agriculture
Ministry sources. At the same time, demand for flour based foods is increasing. Per capita
consumption of flour reached record 33.6 kilograms in 2014, highest since 2006.
Farmers are expecting the government to procure more rice from them to avoid price falls amid
rising supplies. The price of a 80 kilogram pack of rice has already declined to around 170,000
won (around $150) from the average 188,000 won (around $166).
However, an official from the Agriculture Ministry noted that the government is not planning to
increase the reserves. We set up the amount of reserved rice based on the international standard,
allocating 17% of consumption, the official said. Even if we want to raise it, we cant do that
due to shrinking consumption, he added.
Some farmers have expressed concern that increasing imports are also increasing supplies in the
country.

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Oryza Afternoon Recap - Chicago Rough

Rice Futures Bounce as Cash Market Prices
Fail to Follow Futures Lower
Oct 15, 2015

Chicago rough rice futures for Nov delivery settled 13.5 cents per cwt (about $3 per ton) higher
at $12.280 per cwt (about $271 per ton). The other grains finished the day lower; Soybeans
closed about 0.6% lower at $9.0525 per bushel; wheat finished about 1.1% lower at $5.0250 per
bushel, and corn finished the day about 0.9% lower at $3.550 per bushel.
U.S. stocks traded higher Thursday as investors digested key bank earnings and mostly soft
economic data that supported the case for a rate hike delay. The Dow Jones industrial average
and S&P 500 recovered to hold above the psychologically key levels of 17,000 and 2,000,
respectively, after closing below on Wednesday. The Consumer Price Index out Thursday
showed little inflation in the near-term, while retail sales barely rose Wednesday. U.S. CPI
declined 0.2% in September, matching expectations. Ex-food and energy, the price index rose
0.2% for the month, following a 0.1% rise in August. In another sign of continued strength in the
labor market, weekly jobless claims declined to 255,000, falling back to a 42-year low.
In Europe, the pan-European Stoxx 600 index closed up about 1.5% on Thursday. In Asia,
Japan's Nikkei finished 1.15% higher, while in China the Shanghai Composite closed 2.32%
higher. In afternoon trade, the Dow Jones Industrial Average gained 135 points, or 0.8%, to
17,058. The S&P 500 rose 16 points, or 0.85%, to 2,011, with financials leading nine sectors
higher and materials the only laggard. The Nasdaq traded up 43 points, or 0.91%, at 4,827. Gold
is trading about 0.6% higher, crude oil is seen trading about 1.2% lower, and the U.S. dollar is
seen trading about 0.4% higher about 1:00pm Chicago time.
Wednesday, there were 4,529 contracts traded, up from 2,084 contracts traded on Tuesday. Open
interest the number of contracts outstanding on Wednesday increased by 235 contracts to
12,706.

Philippines Rice Stocks Continue to Decline

for Fourth Consecutive Month
Oct 15, 2015

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The Philippines rice stocks have declined for fourth consecutive month in September 2015 after
increasing in April and May, according to the Bureau of Agricultural Statistics (BAS).
Total rice stocks in the Philippines as of September 1, 2015 stood at around 1.96 million tons,
down about 12.5% from around 2.24 million tons recorded in August 2015, and up about 31.5%
from around 1.49 million tons recorded during the same period last year.
According to the BAS, household stocks (which account for about 29.2%% of total rice stocks in
the country) stood at around 570,000 tons as of September 1, 2015, down about 5% from yearago levels of around 600,000 tons. Commercial warehouse rice stocks (which account for about
29.7% of total stocks) have reached around 580,000 tons as of September 1, 2015, up about 32%
from their year-ago levels of around 440,000 tons. The rice stocks with the National Food
Authority (NFA) (which account for 41% of total stocks) stood at around 800,000 tons, up about
78% from around 450,000 tons recorded in September 2014.

Month-on-month, household rice stocks are down about 22%, commercial warehouse rice stocks
are down about 19% and NFA rice stocks - in which about 91.8% are imported rice - are up
about 1.2%, according to the BAS.
The BAS says that the Philippines' rice stocks as of September 1, 2015 are enough to last for 58
days (household and commercial stocks are enough for17 days each and stocks with NFA are
enough for 24 days).

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USDA Grants $555,000 to Boost Organic

Rice Production in U.S.
Oct 15, 2015

The USDA's Organic Agriculture Research and Extension Initiative (OREI) has allocated an
grant of $555,000 to Washington-based The Organic Center to enhance organic rice research and
boost organic rice production in the southern regions of the U.S., according to a press release.
Researchers from Texas A&M AgriLife Research & Extension Center at Beaumont, Texas
A&M University's Department of Soil and Crop Sciences, USDA's ARS Dale Bumpers National
Rice Research Center, University of Arkansas Rice Research and Extension Center, University
of Arkansas at Pine Bluff Department of Agriculture will also be involved in the project.
The Organic Center will be responsible to communicate the findings of the research to the
scientific community, organic rice growers and organic industry members.
The Director of Science Programs The Organic Center said: "There is a critical need for
information on organic rice systems to help expand production and meet the demand of this
high-value market."
Organic rice producers in the southern U.S. lack knowledge about tools that support organic rice
production leading to a lacklustre performance. The organic rice acreage has also not increased
significantly over the years due to these reasons. The project will focus on developing
economically viable organic rice production practices for the Southern U.S. that will allow
producers to grow organic rice more sustainably and profitably.
"Results from this project will empower growers to make informed choices on inputs that will
result in sound pest management, higher and more consistent yields, improved milling and grain
quality, and enhanced soil quality," said the Chairman of the Board of Trustees for The Organic
Center. "This will help the market for domestically produced organic rice to continue to expand,
and will sustain rural communities in areas where conventional rice acreage has been
decreasing," he added.

Thailand, Vietnam Rice Sellers Increase

Some of Their Quotes Today; Other Asian
Quotes Remain Unchanged
Oct 15, 2015

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Thailand rice sellers increased their quotes for 100% rice, 5% broken rice, parboiled rice and
Hom Mali rice varieties by about $5 per ton each to around $370 - $380 per ton, $360 - $370 per
ton, $365 - $375 per ton and $820 - $830 per ton respectively. Vietnam rice sellers increased
quotes for 5% broken rice and 15% broken rice varieties by about $5 per ton each to around $355
- $365 per ton and $345 - $355 per ton respectively. Other Asian rice sellers kept their quotes
unchanged.
5% Broken Rice
Thailand 5% rice is indicated at around $360 - $370 per ton about $5 per ton premium on
Vietnam 5% rice shown at around $355 - $365 per ton. India 5% rice is indicated at around $355
- $365 per ton, about $50 per ton premium on Pakistan 5% rice shown at around $305 - $315 per
ton.
25% Broken Rice
Thailand 25% rice is indicated at around $330 - $340 per ton, about 5% discount on Vietnam
25% rice shown at around $335- $345 per ton. India 25% rice is indicated at around $315 - $325
per ton, about $35 per ton premium on Pakistan 25% rice shown at around $280 - $290 per ton.
Parboiled Rice
Thailand parboiled rice is indicated at around $365 - $375 per ton. India parboiled rice is
indicated at around $335- $345 per ton, about $70 per ton discount to Pakistan parboiled rice last
shown at around $405 - $415 per ton.
100% Broken Rice
Thailand broken rice, A1 Super is indicated at around $305 - $315 per ton, at par with Vietnam 100%
broken rice shown at around $305 - $315 per ton. India's 100% broken rice is shown at around $300 $310 per ton, about $25 per ton premium on Pakistan broken sortexed rice shown at around $275 - $285
per ton

Global Rice Quotes

October 16th, 2015
Long grain white rice - high quality
Thailand 100% B grade 370-380

Vietnam 5% broken

355-365

India 5% broken

350-360

Pakistan 5% broken

305-315

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Myanmar 5% broken

415-425

Cambodia 5% broken

415-425

U.S. 4% broken

490-510

Uruguay 5% broken

535-545

Argentina 5% broken

530-540

Long grain white rice - low quality

Thailand 25% broken

330-340

Vietnam 25% broken

335-345

Pakistan 25% broken

280-290

Cambodia 25% broken 400-410

India 25% broken

325-335

U.S. 15% broken

500-510

Long grain parboiled rice

Thailand parboiled 100% stxd 365-375

Pakistan parboiled 5% broken stxd

405-415
India parboiled 5% broken stxd 335-345

U.S. parboiled 4% broken

590-610

Brazil parboiled 5% broken

545-555

Uruguay parboiled 5% broken NQ

Long grain fragrant rice

Thailand Hommali 92%
820-830

Vietnam Jasmine
465-475

India basmati 2% broken

NQ

Pakistan basmati 2% broken

NQ

Cambodia Phka Mails 830-840

Brokens
Thailand A1 Super
305-315

Vietnam 100% broken 305-315

Pakistan 100% broken stxd

275-285

Cambodia A1 Super
355-365

India 100% broken stxd

290-300

Egypt medium grain brokens NQ

U.S. pet food 330-340

Brazil half grain

NQ

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

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