20110511 creed rice market report

Copyright © 2011 Creed Rice. Co., Inc. All Rights reserved www.creedrice.com

May 11, 2011 - of 4

Southern U.S. - Long Grain Abbreviation Quote BasisU.S. #2 Long Grain, max. 4% Broken, Hard Milled #2/4% $22.50 per cwt. sacked, F.A.S. U.S. GulfU.S. #2 Long Grain, max. 4% Broken, Hard Milled #2/4% $22.50 per cwt, BULK, FOB Vessel US GulfU.S. #2 Long Grain, max. 4% Broken, Hard Milled #2/4% $23.0 per cwt. containerized FOB US GulfU.S. #2 Long Grain, max. 4% Broken, Hard Milled #2/4% $550.00 per mt sacked delivered Laredo TXU.S. #2 Long Grain, max. 4% Broken, Hard Milled #2/4% $24.00 per cwt sacked delivered Miami FLU.S. #3 Long Grain, max. 15% Broken, Hard Milled #3/15 $21.50 per cwt. sacked, F.A.S. U.S. GulfU.S. #3 Long Grain, max. 15% Broken, Hard Milled #3/15 $540.00 per mt sacked delivered Laredo TXU.S. #2 Long Grain Brown, max. 4% Broken, 75% yield #2/4/75 no quote per mt bulk FOB vessel NOLAU.S. #1 Parboiled L/G Brown, max. 4% Broken, 88% yield #1/4/88 no quote per mt bulk FOB vessel NOLAU.S. #1 Parboiled L/G MILLED, max. 4% Broken (except 0.8% damage) #1/4 Parb no quote per mt sacked FOB vessel NOLAU.S. #1 Parboiled L/G MILLED, max. 4% Broken #1/4 Parb $600.00 per mt bulk FOB vessel NOLAU.S. #2 Long Grain Paddy, 55/70 yield #2 55/70 $280.00 per mt bulk F.O.B. vessel NOLALong Grain, max. 20% broken, Hard milled (Ghana specs) #4/20/hm $20.50 per cwt. sacked, F.A.S. U.S. GulfU.S. #5 L/G, max. 20% broken, WELL MILLED #5/20/wm $20.00 per cwt. sacked, F.A.S. U.S. Gulf

Southern U.S. - Medium GrainU.S. #2 Medium Grain, max. 4% broken, Hard Milled #2/4% no quote per mt bulk FOB vessel NOLAU.S. #2 Medium Grain Paddy, 58/69 yield #2 58/69 no quote per mt bulk FOB vessel NOLA

U.S. South Brokens:Flour Quality brokens Flour Qlty $15.00 per cwt. bulk, F.O.B. railPet Food Quality / #4 Brewers (milled) contracts M/A $13.50 per cwt. bulk, F.O.B. rail

U.S. California Brokens:Flour Quality brokens Flour Qlty $19.00 per cwt. bulk, F.O.B. millPet Food Quality / #4 Brewers contracts M/A $14.00 per cwt. bulk, F.O.B. mill

California - Package QualityPackage Rice for Industrial Use and Repackers #1/4% $37-$38 per cwt. bulk F.O.B. Mill

California - Medium GrainU.S. #1 Medium Grain, max. 4% Broken #1/4 $835.00 per mt sacked containerized FOB MillU.S. #1 Medium Grain, max. 4% Broken #1/4 $875.00 per mt sacked containerized OaklandU.S. #1 Medium Grain milled rice, except max. 7% Broken (Japan Specs) #1/7% $875.00 per mt sacked in 30kg bags FOB vesselU.S. #3 Medium Grain Brown rice, max. 8% broken (Korea Specs) #3 Brown $810.00 per mt in totes containerized OaklandU.S. #1 Medium Grain Paddy, 58/69 yield #1 58/69 $550.00 per mt bulk ex-spout Sacramento CA

Market ReportMay 11, 2011

World Market Price Value Factors

This week05/11/11

Last week05/04/11

1 Year Ago05/12/10 LDP 2010 Loan

FactorsLong Grain To be 18.50 15.03 00.00 9.91Medium Grain issued 18.19 14.75 00.00 9.65Short Grain May 11 18.19 14.75 00.00 9.65Brokens 8:30am 13.09 10.35 - 7.01

WMP and Loan Rates ‘10 crop L/G M/G

Yield 52.78/14.31 61.03/8.69WMP 11.64 12.24Loan 6.23 6.50Difference (5.41) (5.74)

U.S.D.A. World Market Price:

Posting: (May/June Shipment)

Southern U.S. - Package QualityPackage Quality Parboiled L/G, max. 4% broken (0.8% damage) Pkg. Parb. $28.00 per cwt. bulk F.O.B. millPackage Quality Long Grain Milled, max. 4% broken Pkg. L/G $21.50 per cwt. bulk F.O.B. millPackage Quality Long Grain Milled, max. 4% broken (select variety) Pkg. L/G $24.00 per cwt. bulk F.O.B. millPackage Quality Long Grain Brown Rice, max. 4% broken Pkg. Br. $31.00 per cwt. bulk F.O.B. millPackage Quality Medium Grain Milled, max. 4% broken Pkg. M/G $35.00 per cwt. bulk F.O.B. mill


May 11, 2011 - of 4

Far East ReportSOUTHEAST ASIAN MARKETS

In Thailand, the market remains extremely quiet, not because prices are not competitive (they are), but due to the general lack of fresh demand offshore...or pent up demand as is the case with The Philippines.

Prices are mostly sideways with 100% B quoted at $500 per mt FOB Bangkok; 5% is $480 and parboil is $505. However, due to the lack of business, today’s quoted levels are biddable. The exceptions are both white and fragrant brokens, and Hom Mali.

In the meantime, any new Iraq tender will likely be delayed somewhat, account the injury suffered by the director of the grain board in the roadside bombing reported in our issue last week. This seems to be the best prospect for volume business for white rice in the near future. There are some shipments of white rice ongoing to West Africa, albeit slow, as is the parboil market.

Otherwise, the market is quiet and the undertone steady to slightly softer.

In Vietnam, export activity has been pretty healthy for the first third of 2011 with a total of 2.5 MMT according to the Vinafood web site...660,000 MT in April alone. The Agricultural Ministry has projected that 2011 exports may reach as high as 7.4 MMT. This may prove to be a little bit of an optimistic goal...we shall see.

Prices are steady to firm, with 5% quoted at $480 per mt FOB HCMC; whilst 25% is $445. The Viet prices are basically on par with Thai on the higher grades.

Otherwise, the market is quiet with Indonesia now out of the market as they complete their main

Thailand Vietnam India Pakistan Uru. Arg. Brazil100%B $500.00 5% $480.00 Export ban, MEP $900

5% $480.00 5% N/A 5% $480.00 $515.00 $515.0010% $475.00 10% $475.00 10% N/A 10% no quote $505.00 $505.0015% $470.00 15% $465.00 15% N/A 15% no quote no quote no quote25% $455.00 25% $445.00 25% N/A 25% $440.00

Parb. 5% N/A Parb 5% $515.00 $480.00Brokens $415.00 Brokens $415.00 Var. 1121 $1350 Parb 15%* $500.00 Brokens

Parb. 100B sorted $505.00 MEP-5% $490.00 Basmati Brokens $390.00 $385Thai Hom Mali $930.00 MEP-25% $470.00 Traditional $1800 Basmati Paddy

Frag. Brokens $465.00 Pusa $1300 S. Kernal $1300.00 $300.00All prices basis U.S. dollars per metric ton, F.O.B. vessel, corresponding home port *Bangladesh Specs.

OFFSHORE QUOTES

season harvest, and Iraq on hold, and The Philippines yet to come to the table. In a word...Boring!

Thailand ExportsJan. 1 - Apr. 27, 2011: 3,812,490 mt Jan. 1 - Apr. 27, 2010: 2,610,203 mt Jan. 1 - Apr. 27, 2009: 2,602,447 mtThai Baht 30.10-30.15 : 1 US Dollar

INDIA AND PAKISTANIn India, the big news in the market is

the slight easing of the export ban in Andra Pradesh Province under certain conditions for a period of two months. The provisions allow paddy to be exported on an interstate basis under monitored pricing. And, that parboil rice has no restrictions and can be sold offshore. This comes as no real surprise, as we have been anticipating a similar plan in previous reports of ours. This will not likely effect the global supply situation much, with the exception of putting some additional pressure on Thai parboil, which they are already feeling from Brazil.

In Pakistan, it is most difficult to focus on the commercial sector with so much media coverage on the political arena. However, we will do our best.

The market is quiet with stable but firm prices, as IRRI-6 5% is quoted at $480-490 per mt FOB Karachi; 25% is $440 and brokens are $390. Parboil is slightly higher than Thai at $515-520.

Export activity on coarse rice is mostly confined to core markets in the region along with the usual border trade with Iran. Basmati is rather widely traded, and priced around $1300 FOB.


May 11, 2011 - of 4

U.S. ReportU.S. GULF, MERCOSUR, & FUTURES

The Southern market remains very quiet as most of the focus is on the horrendous flooding in the heartland of America. Whereas, the impact on the rice growers throughout this region has yet to be determined, it is estimated that over $500 million worth of damage has already been done to Arkansas Agriculture alone. We anticipate, given weather forecast for the next few weeks, that the flooded farmland will slowly begin to subside in rice producing areas in N.E. Ark. and the boot heel of MO. However, it is a case by case situation, as obviously high areas will drain first and the growers in those areas will be reprieved first. Now, this is not to lessen the overall scope of the disaster...as some officials have compared this to the damage done by Hurricane Katrina. In short, will we lose some acreage?..absolutely yes. How much remains to be seen, as there is still about a 3-4 week window of opportunity to plant or replant. But, that is about it and yields will suffer to some degree on the later rice. As the Mississippi River continues to rise, and flood waters flow South, there are growing concerns about additional flooding in places like Baton Rouge and LSU, in particular. However, the silver lining, if there is one, is that the Army Corp of Engineers are already planning on releasing water into floodways by opening the Morganza spillway North of Baton Rouge and the Bonnet Carre spillway near New Orleans (which would drain into Lake Pontchartrain).

There is practically nothing of essence to discuss in our rice market in the Gulf, so I will not attempt to do so.

For nominal purposes, we are finding quotes from vendors for #2-4% long grain around $515 per mt bagged FOB or $490

basis bulk. The paddy market is completely dead account the aforementioned conditions of the river, but for argument sake let’s call the market bid/asked at levels that reflect $265/$285.

As regards futures, we witnessed a major correction highlighted by a limit down session on Wednesday of last week. Overall, rice contracts were down $1.00-1.20 for the week.

No real changes in the Mercosur markets as harvest is finished in most areas.

Our crop estimates remain (basis paddy):Brazil -- 13.4 MMTArgentina -- 1.7 MMTUruguay -- 1.5 MMT

CALIFORNIA, AUSTRALIA & THE “MED”The general state of the market is basically

unchanged as mills continue to ship against old business to Korea, Japan, and Libya. Prices on both paddy and milled are basically steady.

As regards new business, we understand an additional 12,000 mt has been purchased in the local market earmarked for Libya, and rumors about an additional 10,000 mt for new crop. We firmly believe Libya will be an importer of California rice for the next marketing year, as we do not see the situation in Egypt changing with the ban.

Elsewhere, in Australia, their crop (like in Mercosur) is practically complete and our estimate is unchanged at 800,000 mt basis paddy.

The undertone of the global market for Calrose remains firm and the outlook for the next marketing year is bright.

CBOT Rough Rice Futures (05/09/11 Volume: 969 Open Interest: 22,239)

Contract Month

Tuesday’s Close Price

Net Change From PricesMonday Last Report One Year Ago 05/11/10

‘11 May $13.980 UP 0.035 DOWN 1.165 ‘10 May $11.690‘11 Jul $14.170 UP 0.045 DOWN 1.220 ‘10 Jul $11.895

‘11 Sep $15.070 UP 0.065 DOWN 1.095 ‘10 Sep $11.420‘11 Nov $15.390 UP 0.065 DOWN 1.060 ‘10 Nov $11.605‘12 Jan $15.695 UP 0.065 DOWN 1.025 ‘11 Jan $11.900

‘12 Mar $16.015 UP 0.065 DOWN 0.980 ‘11 Mar $12.190

U.S. Paddy Market ReportTexas - Buyers’ bids are slightly higher this week ranging $5.75-$6.75 per cwt over loan depending on variety. We are beginning to see some firm offers at $7.00 per cwt over loan. New crop planting is almost completed.

Louisiana - Bids are unchanged again this week at $10.90 per cwt FOB farm. New crop planting in SW Louisiana is almost completed.

Mid South - Floods continue to cause substantial problems. There has been a little planting in the last few day, but most of the flooded areas will take some time to drain. This situation merits continuous monitoring. The cash market is basically unchanged with bids for long grain at $11.00 per cwt loaded barge up-river while sellers’ price

ideas are $12.00 per cwt.

California - 2010 Calrose M/G is bid at $13.00 per cwt over loan with last trades at $13.50-$13.75. 2011 new crop traded this week at $13.00 per cwt over loan.

Reflective Prices (all basis per cwt FOB country, 2010 Crop)Texas Louisianna Mid-South California

Long grain $12.25-13.25 $10.90 $10.00b/11.00a *Med Grain * 14.50 new crop $17.25 $20.55

L/G is #2 55/70, M/G is #2 58/69 (California #1)* - These areas do not have sufficient supplies of this type to quote.


May 11, 2011 - of 4

Rice Emerged - Selected States -- Week Ending

State May 8, 2010

May 1,2011

May 8, 2011

2006- 2010Avg.

Arkansas 79 33 43 61California 2 - - 9Louisiana 88 81 93 83

Mississippi 72 53 67 68Missouri 70 5 10 50

Texas 69 78 79 846 States 67 37 45 57

USDA Export Sales Highlights(April 22 - 28, 2011)Sales

Net sales of 19,900 MT were down 49 percent from the previous week and 70 percent from the prior 4-week average. Increases were reported for:

Haiti (7,400 MT)Mexico (5,700 MT)Saudi Arabia (2,500 MT)Guinea-Conakry (1,100 MT)Equatorial Guinea (500 MT)

ExportsExports of 59,900 MT were up 12 percent from the previous week, but down 13 percent from the prior 4-week average. The primary destinations were:

Mexico (21,700 MT)Japan (14,400 MT)Saudi Arabia (9,200 MT)Ghana (5,300 MT)Jordan (2,100 MT)

Source: USDA

Upcoming Events:June 7-9, 2011 TRT Americas Conference 2011 For more info go to: trtamericas.com

June 26-30, 2011 USA Rice Millers’ Association Convention For more info go to: www.usarice.com

Please note:June 8 No Creed Rice Market Report to be issued account our atten- dance at the TRT Americas Conference.June 29 No Creed Rice Market Report to be issued account our atten- dance at the RMA convention.

Upcoming Tenders:

May 17 KCCO Inv. 2000000147 tender to buy 1030mt of US #5, max 20% Long Grain and 1030mt of US #5, max 20% Medium grain, for inland plant shipment June 6-20, June 21 - July 5

May 26 AARQ TRQ tender AARQ Association for the Administration of Rice Quotas, Inc.NOTICE OF OPEN TENDERIndependent bids are invited for rights to ship U.S.-origin milled rice to the European Union under a tariff-rate quota (TRQ) granted by the EU to the United States.Bids must be submitted on May 26, 2011 for the July 2011 TRQ Tranche, in which the following quantity is available: Volume (metric tons) EU DutySemi-Milled or Milled Rice 9,680 zero (HTS item 1006.30)

TRQ Certificates will be awarded to the highest bidder(s). Any person or entity incor-porated or domiciled in the United States is eligible to bid. The minimum bid quantity is 18 metric tons. Performance security (the lesser of $50,000 or the total value of the bid) must be submitted with each bid. Potential bidders may obtain the required bid forms and bid instructions from:

AARQ AdministratorEconomic Consulting Services, LLC2001 L Street, NW, Suite 1000Washington, D.C. 20036Tel: (202) 466-1150 Fax: (202) 785-3330

Note: Potential bidders should consult regulations in the Official Journal of the Euro-pean Union to determine the applicable tariff rate on semi-milled/milled rice. AARQ disclaims any responsibility for advising potential bidders on applicable tariff rates. Potential bidders should also consult EC regulations relating to testing for unauthor-ized GMOs.

Tenders Results:May 3 KCCO Inv. 2000000064 cancelled by KCCO due to a change in program requirements.

Rice Co-Products - Spot market prices basis $ per short ton bulk, FOB mill (virtually no spot supply available for sale in South, except hulls)Texas Louisiana Arkansas California

Bran: $110-$115 $105 Not Available ($110) $140-$150Mill Feed: $45 $35 Not Available ($40)

Ground Hulls: $5 $5 $15Unground Hulls: $5 $5 $12 $8

Creed Rice Co. Inc. 800 Wilcrest Suite 200 Houston, Texas 77042 USAPh 1.713.782.3260 Fax 1.713.782.4671 www.creedrice.com email: [email protected] & [email protected]

Brokers • Consultants • Market Reports • Arbitrators

Rice Planted - Selected States -- Week Ending

State May 8, 2010

May 1,2011

May 8, 2011

2006- 2010Avg.

Arkansas 94 45 53 80California 23 5 30 38Louisiana 95 94 96 93

Mississippi 87 71 77 84Missouri 96 13 14 74

Texas 95 92 93 946 States 83 49 57 76

USDA Crop Progress

20110511 creed rice market report

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