RF Insights: October Market Update

Rice Market Highlights

• USDA is forecasting LG production up 8% from last year. Based on excellent early field yield reports, USDA may be slightly underestimating the size of the crop.  
• USDA October 11 Supply & Demand update kept 2024/25 long grain ending stocks at 60 million bushels, up from 43 million bushels on 7/31/24.
• Rough rice exports are expected to continue at the strong pace of the 23/24 crop; however, milled rice will need further improvements in Haiti and additional Iraq sales.
• World rice stocks are showing to be fairly large despite the earlier flooding in South America.

November '24 Rough Rice Futures

Key:Orange Line: 9-day moving average Blue Line: 27-day moving average

CBOT Rough Rice Values (9/3/24 - 10/11/24)

U.S. Long Grain Rice Supply-Demand

U.S. Medium Grain Rice Supply-Demand

CBOT Receipts (as of 10/11/24)

Rice Market Summary

November CBOT futures have traded primarily in the $15.00 to 15.25 range in recent days, falling below $15 on 10/11/24. Rough rice exports are starting off strong, however milled rice demand is softer. South American prices are high, but Asian prices are declining. These are the primary factors that will battle for market direction into 2025.  

CBOT receipts are slowly being canceled after the September deliveries. There are 232 receipts as of 10/11/24.

Soybean Market Highlights

• The October 11 Supply and Demand report from USDA only showed slight changes in production and use, the carryout projection remains at 550 million bushels.  
• USDA slightly lowered the projected yield to 53.1.
• USDA is projecting new crop exports for the year at 1.85 billion bushels compared to 1.7 billion bushels for the 2023/24 crop. This seems very optimistic, given the current sales pace.
• World soybean stocks are projected to grow 20% next year compared to this year.

November '24 Soybeans

Key:
Orange Line: 9-day moving average
Blue Line: 27-day moving average

CBOT November Soybean Values (9/3/24 - 10/11/24)

U.S. Soybean Supply-Demand

Soybean Market Summary

Soybean futures hit a low of 9.55¼  on August 14 and have maintained mostly in the mid to low 10s in recent weeks. Traders recently have been relieved by rains in Brazil. We will likely be in a South American weather market for the next several weeks. Therefore, volatility on both sides can be expected. Longer term, large world supplies will weigh on the market. Basis in the region has improved due to improved river levels, lower barge freight costs on the Mississippi River, and lower soybean oil stocks.  

Weather Outlook

The Mississippi River graphs below show declining levels from the huge swell caused by Hurricane Helene. Future rainfall will be needed to prevent river levels from returning to critical levels for the last weeks of the harvest window and beyond.  

Precipitation forecasts do not show a lot of promise at the current time.  

NOAA Precipitation General Outlook

NWS 7-Day Precipitation Outlook

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