U.S. Department of Agriculture (USDA) Chief Economist Joe Glauber told attendees of the agency's Agricultural Outlook Forum that the rice market will tighten marginally this year with lower plantings.
"Rice plantings will fall to 2.88 million from 3.6 million acres last year," Glauber said. "Almost all of the reduction in rice acreage will come from long-grain plantings."
Glauber said USDA expects rice yields to return to trend with the yield for rice forecast at 7,225 pounds per acre. Rice production is projected at 206.5 million cwt., down 36.6 million cwt. from last year. Because of the large carryin from 2010/11, total rice supplies are forecast to be 277.8 million cwt., down just 20 million cwt. from last year.
Domestic use for all rice is forecast at 126 million cwt., largely unchanged from last year. By class, long-grain domestic use is forecast down 3 million cwt., or 3 percent, while medium- and short-grain use is forecast to be unchanged, Glauber told forum participants.
Further, with large global supplies, Glauber said exports will be pressured and are expected to drop to 111 million cwt., down 5 million cwt. from 2010/11 levels. Ending stocks are expected to decline to 40.8 million cwt. and with a projected stocks-to-use ratio of 17.2 percent, the U.S. market will tighten, particularly for long-grain rice.
For long-grain rice, the season average price is expected to rise to $11.50 per cwt., while the season average price for combined medium- and short-grain rice is estimated at $17.75 per cwt., up 4.4 percent from 2010/11 levels.
USDA's annual Agricultural Outlook Forum is a two-day event for USDA staff and agriculture and food industry professionals. The program includes sessions on the outlook for food prices, foreign trade, risk management, sustainable agriculture and conservation.