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East Arkansas | It's most bearish before it becomes most bullish or so I've heard. As my screen name suggests I follow the rice market rather closely but I also grow soy, corn and wheat. That said I'm watching a rice market that gets more bearish news everyday. The US has historically low rice acres this year, but any mention of higher prices is met with an argument that there are ample world stocks. For 2014, there are constant mentions of additional domestic rice acres dragging down the rice market! I know that rice is an international market like wheat but why the constant drum beat about additional domestic production of maybe 500,000 acres?
In 2013 domestic rice acres were around 2.5 million acres which is at the lowest level seen since 1993 when nearly 2.9 million acres were planted. In 2014 acreage estimates take us to maybe 3 million acres. Actually since 1993 the US has planted more than 3 million acres of rice 14 years out of 20 with 2 years being above 3.5 million acres.
Actually the big rice price years were in 2007, 2008 and 2009 when we came off of relatively low production years of 2.8 million acres, 2.7 million acres and 3 million acres respectively. In 2010 we killed the market with a nearly 3.7 million acre low milling nightmare.
So, I understand the talk but it gets old when the merchandisers and the journalists want to have their cake and eat it too concerning acreage estimates. All I have heard is we better get covered when the price comes up but the last time we had rice production this low prices went to 22 dollars/cwt. | |
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Rice market--- and bearish sentiment
