Production:

Colombian rough/paddy rice production is expected to increase 130,000 MT to 1.98 million MT in MY2015/16. In 2014, the area planted fell by about 60,000 hectares (148,000 acres). As a result, rice production declined 132,000 MT. Reduced supplies at the end of CY 2014 put upward pressure on rice prices, increasing 53% since December 2014. This price surge is stimulating expanded planting and Post forecasts that area planted will recover to about 450,000 hectares (1.1 million acres) in MY 2015/2016.

Consumption:

Colombia is one of the highest per capita rice consumers in Latin America at 90 pounds. Consumption trends will likely parallel population growth with demand remaining steady.

Trade:

The CTPA CY 2014 TRQ for U.S. rice was 86,270 MT and was fully subscribed with some imports out-of-quota. The CY 2015 TRQ is 90,152 MT. The first 2015 TRQ auction was held on February 2, 2015, resulting in awards for deliveries of 63,131 MT, or about 70 percent of the total 2015 quota. As of March 5, 2015, 10,161 MT, or 12 percent of the total quota, was imported. There will be two more auctions to allocate the remaining quota volume: June 4, 2015, for 13,104 MT; and, October 15, 2015, for 13,917 MT.

Colombia's rice imports, licit and illicit, are primarily from neighboring countries, Ecuador, Peru and Venezuela. Illicit trade in agricultural products, particularly rice, is a serious concern of the GOC. To address the issue, the GOC established a special office to combat contraband trade and programs are in place to apprehend illegal products and detain those involved in smuggling. Total illicit rice imports are difficult to estimate and remain between 300,000-500,000 MT annually.

Stocks:

The Colombian government does not maintain a policy for holding grain stocks; however, on an ad hoc basis and mostly for rice, the Ministry of Agriculture and Rural Development offers financial storage incentives for producers and millers to hold inventories. It is estimated that rice stocks at the end of CY 2015/16 will be about 140,000 MT of milled rice, which would satisfy about one month of domestic consumption.

Policy:

The CTPA opened the market for imports of U.S. rough/paddy rice under certain phytosanitary trade conditions. Imports of U.S. rough/paddy rice in CY 2014 increased to 13,300 MT from 8,800 MT a year before. The demand for rough/paddy rice, nevertheless, is tempered by strong demand for U.S. milled rice.

The table below illustrates the TRQ fill rates for rice:

2014 CTPA Tariff-Rate-Quota (TRQ) Fill Rates

TRQ(MT)

Volume Imported(MT)

Rice

86,270

86,270

Source: DIAN Colombian Customs and Tax Agency

Under the CTPA, there is an annual quota for U.S. rice that enters into Colombia duty free. In CY 2014, the U.S. rice TRQ was 86,270 MT and was fully subscribed. Colombia maintains an 80 percent duty on U.S. rice imported out-of-quota; however, Colombian millers have imported rough/paddy and also milled rice with an 80% tariff as a result of favorable market conditions.

In 2014, the GOC negotiated subsidies to the rice milling industry to improve storage facilities if they paid a set price to growers of approximately USD 40.00 per ton. In 2015, high rice prices and GOC budget constraints will likely end this agreement for the time being. Should prices fall later in 2015, the GOC may be called into negotiations with the rice milling industry and growers once again.

Production, Supply and Demand Data Statistics:

Rice, Milled Colombia

2013/2014

2014/2015

2015/2016

Market Year Begin: Apr 2013

Market Year Begin: Apr 2014

Market Year Begin: Apr 2015

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

450

450

400

390

450

Beginning Stocks

85

85

120

120

90

Milled Production

1,310

1,310

1,300

1,220

1,350

Rough Production

1,926

1,926

1,912

1,794

1,985

Milling Rate (.9999)

6,800

6,800

6,800

6,800

6,800

MY Imports

325

325

350

350

300

TY Imports

325

325

350

350

300

TY Imp. from U.S.

102

102

0

200

180

Total Supply

1,720

1,720

1,770

1,690

1,740

MY Exports

0

0

0

0

0

TY Exports

0

0

0

0

0

Consumption and Residual

1,600

1,600

1,600

1,600

1,600

Ending Stocks

120

120

170

90

140

Total Distribution

1,720

1,720

1,770

1,690

1,740

Yield (Rough/Paddy)

4.0

4.3

5.0

4.6

4.4