The Rice Advocate, Vol. 17, Issue 33

Volume 17, Issue 33

August 21, 2020

In This Issue:

Rice Market Update: Another Perfect Storm Brewing?
USRPA Addresses Key Long Grain Rice Markets
Texas Rice Update
US Long Grain Rice Makes it to Guatemalan TV

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Rice Market Update: Another Perfect Storm Brewing?

A few days ago we were having an uneventful week by way of harvesting—weather conditions throughout much of the delta were favorable and growers were able to make good progress on bringing rice to the bins. Today we have two major storms headed for the gulf coast and are currently predicted to arrive on the same day and time, something that has not happened since the Great Depression in 1933. In some parts of Texas, the harvest is already in its final stages.

Louisiana is reported to be over 60% harvested by the USDA, but local sources assess that the harvest is further along there. Arkansas’ weather continues to be favorable and growers remain hopeful for both strong field and milling yields. However, the various issues affecting the market along with weather patterns have farmers on the edge.

Prices in the long-grain states have been largely sideways over the past few weeks. Given the focus on harvest and the lack of obvious direction in the cash market, flat prices are likely to continue until some disruption in the market occurs. For example, in Louisiana this week a large paddy exporter entered the market, offering about $0.45 per cwt over last week’s price. They quickly scooped up all that was needed, and the market returned to its dormant state. Since that flurry of business, the bid is reported to have fallen back to $11.75 per cwt.

The South America rice complex grows more intriguing by the moment as producers brace for a drier growing season and prepare for fewer rice acres. Planting milo already seems to be captivating the interest of rice growers concerned about water shortages. A perfect storm is brewing in Brazil as well as they are coming off a year of reduced production, increased exports and a devastating COVID-19 situation A tight stock situation followed by a smaller crop from South America may very well result in a smaller presence in Central America and even Mexico, which bodes well for the US. With export demand for US long-grain rice slow to develop at this point, the industry could greatly benefit from increased market share in those key Central American markets. We remind you that the Mercosur harvest is not until February-March.

Iraqi tenders have once again surfaced in the rumor mill; however, details are opaque at best. It appears that there is some anticipation that the Iraqi Grain Board will announce a tender for US long-grain rice before long. The Iraqi Prime Minister and a trade team are in Washington

D.C. this week and among the list of issues to be discussed are purchases, financing of U.S. rice.

Another gripping story in the world rice industry pertains to the Yangtze River in China where roughly 13 million acres of agricultural land have been flooded, most of which is believed to be corn, beans, rice, and livestock. Currently, rice damage is believed to be downplayed by the Chinese government for political and food security purposes. Regardless, this behemoth of a rice market has seen stocks rise for more than 10 consecutive years, making the potential impact of these floods on the global rice market extremely difficult to predict.

Thai export prices continued to improve this week while the other key exporters all saw small declines in export values. Overall, the market in Asia is generally neutral against last week, and most of the export hype seems to be originating out of Vietnam.

USRPA Addresses Key Long Grain Rice Markets

Major rice buyers of U.S. long-grain rice from Colombia, Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, and Panama along with affiliated U.S. industry members, all tuned in to USRPA's virtual conference yesterday. The presentations focused on the current status of the on-going rice harvest, the short and medium-term outlook of the market, and the influence of the COVID-19 pandemic on the economy.

After some introductory comments from Marcela Garcia (COO of USRPA), Dwight Roberts gave a brief overview of the past 12 months. Roberts described the development of the 2019 harvest into 2020, when the COVID-19 panic set in and living through a pandemic became the reality, in a series of developments he described as "The Perfect Storm."

Dr. Thomas Wynn updated participants on the current harvest and development along the gulf coast, where today farmers are cutting full speed, as well as the anticipation of the harvest in the Mississippi Delta.

Finally, Dennis DeLaughter gave an overview of the world rice market with a focus on the U.S. outlook in short and medium terms. DeLaughter then turned to an economic look at COVID-19 and its influence on the rice market and the economy going forward. DeLaughter highlighted recent information which was extremely interesting to participants; his final thoughts being:

1) the U.S. supply will be larger but will still take some time to fill in the holes,

2) the world market is vulnerable to supply issues & prices will remain elevated in 2021 and

3) COVID-19…. better as confidence improves…but far from normal.

Comments from the various countries are greatly appreciated:

“Excellent Initiative” (Costa Rica)
“Awesome, Perfect. Straight to the point and very executive” (Nicaragua),
“We believe this type of meeting has great value, you should do this regularly with this excellent format” (Guatemala),
“Great session, learned a lot” (Honduras),
“very interesting and useful information. We want you to do it again later in the harvest” (Colombia),
“Excellent meeting, for us it's important to know and understand the trends and risks” (Mexico)

“This kind of meeting is so important, especially during the pandemic with so much uncertainty in the market, for both farmers and our customers in Latin America. We believe in supporting our rice buyers to make important decisions in managing their markets,” responded Dwight Roberts.

The meeting ended with a short Q&A session.

Texas Rice Update

By: Dr. Mo Way, Kate Crumley and Dr. David Kerns

Just want to alert you rice farmers and crop consultants to be on the look out for an aphid…English grain aphid. As you probably know, aphids have piercing-sucking mouthparts, like a rice stink bug. But aphids suck up plant juices from the vascular phloem tissue of plants. They get rid of excess fluids by excreting a sugary substance called honeydew which provides food for an organism called sooty mold fungus. This fungus is black and coats the leaves of affected plants. So, this coating can interfere with photosynthesis and sometimes the honeydew can gum up harvesting operations. Aphids have an amazing reproductive potential, so populations can build-up quickly. They can produce winged forms which can travel long distances with the aid of wind. So, these critters are good colonizers.

I have not observed English grain aphids attacking rice in the field, but I have observed them in abundance in the greenhouse. Anyway, last week I received a call from a concerned farmer in Wharton Co. who recognized the black sooty mold fungus on his rice crop. I immediately thought the cause may be the rice planthopper because this exotic species also produces honeydew. I asked Kate Crumley, who works in Wharton Co. as a Texas A&M Extension IPM Agent, to check out the situation. She visited the farm and farmer and informed me that the critter was an aphid feeding on the foliage and panicles of the rice crop which was being harvested at the time. She sent specimens to Dr. David Kerns, Extension IPM Coordinator, at College Station. David knows his aphids and identified them as English grain aphids…Sitobion avenae. Next week I plan to visit the farmer and inspect his fields which are now being ratooned. I will keep you updated. If you observe sooty mold fungus in your rice crop or if you think you may have any type of insect problem, contact me at 409-239-4265 or moway@aesrg.tamu.edu. There is a possibility this aphid may infest the ratoon crop.

So, this is a good example of how research and Extension work hand-in-glove to help you farmers. Texas A&M is a Land Grant University with 3 missions…teaching, research and Extension (extend research results to clientele). This model was created in 1862 by Abe Lincoln and has survived the test of time! The teaching component includes training undergraduate and graduate students, many go on to serve the Texas and US rice industries.

Winged adult English grain aphid (photo by Kate Crumley)

Sooty mold fungus on rice foliage (photo by Mo Way)

US Long Grain Rice Makes it to Guatemalan TV

On August 17, Roberto Wong, Executive Director of ARROZGUA was interviewed in Guatevision a Guatemalan public television operated by the National Broadcasting System, with general and educational programming, whose headquarters is in Guatemala City. Today, has a 75.5% transmit frequency at the national level.

During the interview, Wong emphasized the importance of ARROZGUA's promotion program “Pon tu granito de arroz” (Put your grain of rice ) as well as the campaigns of the US Rice Producers Association carried out in conjunction with ARROZGUA “School Nutrition Program” & “Marketing Strategies”. Due to the events that we have all faced due to COVID-19, the social media campaign has been the ideal platform to teach Guatemalans the best way to add American long-grain rice to their daily diet.

During the broadcast, chefs presented recipes using American long-grain rice and encouraged the audience to follow our fan page on Facebook. There has been a 90 % increase of followers on the page from July 31 to today.

The social media campaign continues with photos, cooking tips, and rice facts to mention a few.