World Grain - October 2012 - 26

GRAINMARKETREVIEW
Major rice exporters (in million tonnes milled basis)

Rice
IGC forecasts record rice production for 2012-13, but rate of year-on-year increase slows
by Chris Lyddon
Higher rice yields and plantings overall will mean a bigger global 2012-13 crop, but declines in some producing areas, notably in India, will hold down the rate of increase. According to the International Grains Council’s (IGC) most recent forecasts, world rice production in 2012-13 will jump to a record of 466 million tonnes, up from 464 million the year before. “At just 0.4%, the year-on-year expansion will be markedly smaller than in earlier years,” the IGC pointed out. “The rise is underpinned by a modest expansion of plantings and a marginal improvement in yields, but the forecast expansion in output will be much smaller than in recent years, as increases in some regions, including the Americas and Africa, are partly outweighed by a marginal contraction in output in Asia.” One of the factors in the IGC’s forecast is India’s ﬁrst production decline in three years. “A recent improvement in monsoon precipitation has allowed ﬁeldwork to advance, but rains are still expected to remain well below the long-term (50-year) average over the entire season,” it said. “With plantings expected to contract slightly, main (kharif) crop output in 2012-13 is forecast to decline. While this could be partly offset by a larger winter-sown (rabi) outturn, total production in 2012-13 is projected to fall to 99 million tonnes.” The IGC also forecasts that larger sowings could boost output in China to 142.5 million tonnes, up from 140.5 million last year. “Key exporters in the region are also likely to bring in larger crops. This includes Thailand where continued state paddy intervention buying is expected to boost main crop sowings,” it said. “Assuming weather patterns are favorable, total production in 2012-13 is projected to rise by 4%, to 21.2 million tonnes. Above-average crops are also expected in Bangladesh, Indonesia and the Philippines.” The IGC expects a rebound in production in the Americas. “In Brazil, output is estimated to have fallen steeply in 2011-12 on account of a smaller harvested area and reduced yields,” it said. “However, assuming that seeding expands and productivity levels advance, output in 2012-13 is set to recover to 8.7 million tonnes.” The IGC also forecasts a rise of 4% in U.S. production to 6.1 million tonnes, reﬂecting improved yields. For sub-Saharan Africa, it forecast rice production at an all-time high of 13.1 million tonnes, up from 12.5 million. World rice consumption will rise, but not by much. “After the previous year’s solid output-led expansion, consumption in 2012-13 is set to increase only modestly to 465 million tonnes, up from 459 million last year,” the IGC said. With global production and use broadly in balance, the world 2012-13 carryover is set to show little change, including only a modest rise in major exporters’ stocks, the IGC added. It predicted a
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India Pakistan Thailand United States Vietnam 0 2 4 6 8 2009-10 2010-11 2011-12 2012-13 10 12

2012-13 are forecast Source: Production, Supply, and Distribution data base, Foreign Agricultural Service, USDA, http://www.fas.usda.gov/psd

U.S. medium/short-grain prices Million cwt (rough basis) 100 Total medium/short-grain supplies Medium/short-grain season-average farm price* 80 60 40 20 0 1990-91 1992-93 1994-95 1996-97 1998-99 2000-01 2002-03 2004-05 2006-07 2008-09 2010-11 $/cwt 27 24 21 18 15 12 9 6 3

August-July market year
Sources: USDA, National Agricultural Statistics Service, Quick Stats and World Agricultural Supply and Demand Esimates report, U.S. Department of Agriculture.

slight rise in world trade to 34.8 million tonnes, citing “limited prospects for bigger shipments to markets in Asia and Africa.” The September edition of the USDA’s World Agricultural Supply and Demand Estimates report raised its production estimate to 464.2 million tonnes, up 1 million from a month earlier “primarily due to larger expected crops in China, the Philippines, E.U.-27, and the United States.” It put consumption at a record 467.7 million tonnes, up 1.3 million from the earlier estimate. The USDA ERS Rice Outlook reported a mixed picture on prices. “Prices for most grades of Thailand’s specialty and white milled-rice have declined since late August due to the government’s release of stocks,” it said. “In contrast, price quotes from Vietnam continue to increase, mostly due to large purchases by the Philippines, Malaysia, sub-Saharan Africa and China.” Chris Lyddon is World Grain’s European editor. He may be contacted at: chris.lyddon@ntlworld.com.
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World Grain - October 2012

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