OVERVIEW

For 2017/18, global production is slightly lower and remains forecast just below 2016/17’s record. Trade is little changed from last month, though marginally higher than the prior year. Global stocks are the highest since 2001/02, with the majority held by China. For 2016/17, global production is raised to a new record on an upward revision to the Indian crop. Trade is up and remains the third-highest on record. Consumption is revised higher.

FEATURE

Bangladesh is the fourth-largest rice consumer in the world and is mostly self-sufficient. In 2016, imports were minimal. Amid flooding and high prices, however, the government has recently announced the intention to import 600,000 tons to replenish stocks. Interestingly, Bangladesh is beginning to source these imports from Vietnam, a country with whom it recently signed a memorandum of understanding. Typically, Bangladesh imports parboiled rice from neighboring India. Historically, Bangladesh did turn to other suppliers including Vietnam when India banned non-basmati exports from 2008 to 2011. However, this time, India has ample supplies but higher export quotes relative to Vietnam, prompting the shift toward an untraditional supplier.

PRICES

Export quotes for all of the top five suppliers rose over the past month. The U.S. quote remains the highest at $500/mt, which strengthened over the past month by the prospect and confirmation of 30,000 tons sold to Iraq. Thai quotes at $450/mt have risen on strong demand from Iran and other markets. The government continues to finalize sales of food and non-food quality stocks. Pakistani quotes rose to $432/mt in line with additional Ramadan demand. Indian quotes increased slightly to $402/mt on strong offshore demand. Vietnamese quotes surged to $383/mt on increased demand from the Philippines, Bangladesh, and China.

Selected Trade Changes

  • India exports are boosted 500,000 tons to 10.5 million for 2017 on recent robust sales to the Middle East and Africa.
  • Bangladesh imports are raised 450,000 tons to 600,000 for 2017 and raised 100,000 tons to 400,000 for 2018 on efforts to offset flooding losses and to bolster stocks.
  • Sri Lanka imports are doubled to 400,000 for 2017 as the country continues to compensate for a significantly smaller crop (the smallest since 2007/08).