Market Behavior: Rice and Soybean Update

Members reported excellent rice field yields before the rains from Hurricane Francine hit. Overall yields should still be good after factoring in the downed rice. USDA is forecasting long grain production up 8% compared to last year. Milling yields for this year’s crop have been very disappointing.

Export sales for rough long grain continue to be good, although additional milled rice demand will be needed to keep prices supported. World rice stocks are slightly lower than last year. However, stocks are still at relatively high levels. U.S. long-grain rice stocks are projected to increase from 43 million bushels this summer to 60 million bushels next summer.

World soybean stocks are projected to swell 21% into next year as production is outpacing crush worldwide. The U.S. crop is large, and stocks are expected to swell here as well. USDA has exports estimated at 1.85 billion bushels compared to 1.7 billion bushels last year, which seems optimistic.

Futures are down, and basis has also taken a hit due to the low water in the Mississippi River for the 3rd year in a row and also due to a weaker-than-expected soybean oil market. Arkansas is expected to achieve a new record soybean yield of 57 bushels per acre after last year’s record yield of 54 bushels per acre.

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