Market Behavior: Winter

USDA’s January updates showed record yields for Missouri and Arkansas rice from the 2024 crop. Unfortunately, most market stakeholders are struggling with poor milling yields. Milled long grain exports started off slow but have gained some momentum with repeat Iraq purchases.

Rough rice long grain exports started off strong but have slowed. Overall, long grain exports for the year are expected to be slightly below last year. Low milling quality and cheaper prices from other exporters are the main drivers. Medium grain exports have been strong compared to the previous year.

Crop returns favor rice and soybeans in most cases so if the weather cooperates, rice planted acres should be similar to the past two years. U.S. long-grain rice stocks are projected to increase from 43 million bushels last summer to 67 million bushels this summer. Rice trading focus over the next few months will center on export demand for old crops and planting intentions for new crops.

The January USDA update surprised soybean traders by taking the U.S. average soybean yield from the 2024 crop down from 51.7 bushels per acre to 50.7. This and other minor adjustments resulted in a carryout reduction from 470 million bushels to 380 million bushels.

The Arkansas soybean yield for the 2024 crop was a new record at 55 bushels per acre. World soybean stocks are projected to increase by 14% compared to last year, even with the reduction in the U.S. crop. The soybean market has been trading South American weather, which has been relatively good in Brazil but dry in Argentina. Soybean trading focus over the next few months will center on U.S. planting intentions and trade/tariff policy.

GRAYSON DANIELS
VP, Grain Sales and Procurement

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