WORLD RICE SITUATION AND OUTLOOK
Loadings for Indonesia kept rice prices in Asia firm to slightly higher during December. Although currency fluctuations continue to influence pricing, quotes for Thai 100B rose about $10/MT as recent declines in the baht have been offset by support from heavy loadings for Indonesia. Viet prices have generally been steady through December as a result of tight supplies. This is likely to be the case until harvest, as substantial loadings for Indonesia and the Philippines are expected in early 1998. Quotes in Pakistan climbed approximately $15/MT in mid-December when poor weather hampered movement of rice to port, only to fall back to their initial level as exports began to move. The U.S. market remained relatively quiet and prices steady during the month. Prices in California were supported by two Japanese tenders.
The rice export forecast for the United States was lowered 100,000 tons for both 1997 and 1998. The 1997 estimate was reduced to 2.3 million tons due to slower than expected exports in recent months. The 1998 forecast was lowered to 2.7 million tons.
The 1997 export forecasts for Thailand and Vietnam were raised to 5.275 million tons, and 3.5 million tons, respectively. Both of these countries saw strong end of the year demand from Indonesia, as well as other importers taking advantage of currency related price dips. The 1998 export forecast for Thailand was also raised as strong demand in Southeast Asia is expected to draw increased quantities into export channels.
The 1998 export forecast for China was raised to 1.5 million tons due to a projected production increase. China is forecast to produce its second large rice crop in a row, which is expected to lead to an increase in both stocks and exportable supplies.
The 1998 import forecast for Indonesia was raised to 2.25 million tons. A drought-delayed main crop and continued heavy consumption mean large imports will be necessary in early 1998.
The forecast for 1998 rice imports by China was lowered to 750,000 tons. Although China is forecast to produce a record domestic rice crop, imports of higher quality rice are expected to continue.
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