News out of Crowley, Louisiana– Rice capital of the world – reports that the prices of rice are on the rebound, and things are looking up for the 2020 crop out of Louisiana.
Michael Deliberto, LSU AgCenter economist, relayed that there are several reasons why the current economic outlook for rice is positive. “There is no doubt that supplies are tight and demand has been good. These are the highest U.S. prices in at least seven years,” he said.
AgCenter rice specialist Dustin Harrell agreed, stating, ““This year’s rice crop has had a tremendous start.”
Rice planted early this season saw the benefits of a warm March, as the area experienced temperatures that averaged around 10 degrees higher than most years. Even with a few cold snaps in April, and a few outbreaks of “chinch bugs”, rice has bounced back and avoided major challenges, according to Harrell. “It’s one of the best starts I’ve seen in a long time,” he said.
Although heavy rainfall has interfered with planting in north Louisiana and Arkansas, July rice is anticipated at selling for roughly $23 a barrel, and September rice was priced north of $19 a barrel. A barrel is roughly 162 pounds.
U.S. long-grain milled rice prices are currently being propped up by continued bulk sales to Haiti, as well as by expectations of much tighter U.S. supplies later in the market year and higher global trading prices.
Total rice acreage could affect pricing. An acreage shift in Arkansas, the largest rice-producing state, could see lower prices as some acreage used for soybeans may be used for rice. Over the last year, rice planting has increased, with Arkansas handling 78% of the projected 307,000-acre total U.S. rice acreage. This year’s estimates project Arkansas will have almost 1.4 million acres in rice, 21% higher than in 2019.
Louisiana rice growers revealed in March they would expand total rice plantings more than 1% to around 430,000 acres, with long-grain varieties accounting for all the 2020 expansion.
Some export restrictions recently announced by Southeast Asian countries and the effect of lockdown policies in numerous countries amid the COVID-19 pandemic have strained the global rice market. “Most notable among the rice export bans is Vietnam, the third-largest global exporter since 2013,” Deliberto said. He reported Vietnam trade officials are starting to relax restrictions, though
The good news is that overall exports from the United States are up. In fact, through February 2020, U.S. exports of long-grain rice totaled 41.5 million hundredweight, which is up 11.5% from 2019. U.S. shipments are well ahead of 2019 to various countries, including Colombia, Guatemala, Haiti, Mexico, Nicaragua and Venezuela. Latin America is projected to remain the top market for U.S. long-grain rice.
In a related article, Harrell relayed that while the coronavirus outbreak has shuttered schools, but he believes this has presented an opportunity for young people to be involved in planting rice, which he has witnessed himself. The AgCenter’s mission of ensuring farmers are “in the know” is pushing forward despite the effects the current health crisis is having on daily operations. “We have means of communication that we can use,” he said. “We can use text messages; pictures sent through text messages. I can answer questions electronically. We can do a lot of diagnostic work virtually now.”
Bottom line – the rice industry is as strong as ever, with leaders like Harrell and Deliberto at the helm.
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