Different from other staple food varieties in the domestic market and the international rice market, the domestic rice market as a whole operated strongly in the first quarter of 2024, while the prices of other staple grains such as corn and wheat in the domestic market were weak, and the prices of rice in Thailand and Vietnam in the international market also fell from a high level.
Monitoring shows that at the end of March 2024, the price of mid-to-late indica rice of common varieties in the main producing areas was 2820~2920 yuan/ton, up 20~80 yuan/ton from the beginning of January and 60~200 yuan/ton from the same period last year; the price of japonica rice in Suzhou and Anhui was 2870~2945 yuan/ton, up 25~100 yuan/ton from the beginning of January and 100~200 yuan/ton from the same period last year; and the price of round-grain japonica rice in Jiamusi, Heilongjiang was 2700 yuan/ ton, basically the same as the beginning of January, up 80 yuan/ton from the same period last year.
Due to cost support, the prices of mid-to-late indica rice and japonica rice in the main producing areas and sales areas also increased to varying degrees in the first quarter, but the increase was smaller than that of rice. In early April, the domestic rice market as a whole maintained stable operation, and the quotation in some areas was 20~30 yuan/ton.
In terms of time, the price of rice in Thailand and Vietnam in the international market fell sharply. At the end of March, Thailand's 5% broken rate rice export FOB price was 601 US dollars/ton, down 51 US dollars/ton from the beginning of January, but still up 111 US dollars/ton from the same period last year, and Vietnam's 5% broken rate rice export FOB price was 584 US dollars/ton, down 57 US dollars/ton from the beginning of January, still up 114 US dollars/ton from the same period last year. In early April, rice export quotations from Thailand and Vietnam maintained a downward trend, falling to $578/mt and $581/mt respectively by April 10.
From the perspective of domestic new season rice production and quality, the output of rice in 2023 will be about 206.603 million tons, a decrease of 1.892 million tons over the previous year, considering that the output of early rice in 2023 will be 28.337 million tons, an increase of 215,000 tons over the previous year, therefore, the output of medium and late rice in 2023 will decrease by 2.107 million tons compared with the previous year, and the quality of medium and late rice in 2023 will be significantly improved compared with the previous year, and the supply of high-quality varieties such as mid-to-late indica rice and long-grain japonica rice will increase, and the supply base is conducive to the strong operation of domestic rice prices.
From the perspective of monthly rice imports, since the second half of 2023, the monthly import volume of rice from the mainland has remained at a low level, and from January to February 2024, the mainland imported 220,000 tons of rice, a year-on-year decrease of 63.8%. Among them, mainland rice imports in February were the lowest monthly since 2016. The high cost of international rice imports, the sharp reduction in rice imports, and the decline in domestic rice substitution have strengthened domestic rice demand and price expectations.
In order to effectively protect farmers' enthusiasm for growing grain and ensure the smooth sales of farmers' surplus grain, the deadline for the implementation of the minimum purchase price plan for medium and late rice in Heilongjiang Province in 2023 has been extended to March 31, 2024, which is one month longer than the previous year. Therefore, farmers still have this sales channel in March, and Heilongjiang has announced the minimum purchase price of rice storage points for four times, and the capacity of rice purchase warehouses is sufficient.
From the point of view of the minimum purchase price of rice auction, the minimum purchase price of rice auction was launched at the end of March last year, considering that the announcement of the minimum purchase price of rice auction was released a week before the official auction, the market formed expectations in advance. Correspondingly, no minimum purchase price paddy auction will be launched in the first quarter of 2024. The delay in the auction of paddy at the lowest purchase price compared with the previous year has helped domestic rice prices to remain strong in the first quarter, both in terms of effective supply to the market and the impact on market expectations.
Judging from the market's situation of increasing local reserves and local reserves bidding for the purchase of new season paddy, since the new season of rice was put on the market, the market has continued to report on the increase in rice reserves, which has boosted market price expectations; in the first quarter, local reserves continued to bid for the purchase of paddy, and the transaction price remained strong, which also boosted the market's confidence in paddy prices. Based on the average transaction price of mid-to-late indica rice purchased by local policy grain transactions in Zhejiang, the average purchase transaction price in the first week of March 2024 was 3,012 yuan/ton, an increase of 75 yuan/ton compared with the average purchase transaction price in the first week of January (2,937 yuan/ton).
From the first quarter of the corresponding festival effect, February is the traditional holiday Spring Festival, although the current stage of the festival effect is greatly discounted, but taking into account the sales habits of farmers, corporate holidays and other factors, enterprises still have stocking needs before the holiday, after the holiday factory starts, schools and other group procurement followed, relatively speaking, there is a short-term centralized procurement demand in the first quarter.
In early April, rice prices in some parts of the country fell, with a pullback of 20~30 yuan/ton. The purchase of the minimum purchase price for mid- and late-producing rice in 2023 has ended at the end of March, and the purchase of local reserves is also nearing completion, and the rotation of reserves will continue. At the same time, the market has also formed expectations for the lowest purchase price of paddy auctions, and the weakening of rice prices in the international market has put downward pressure on domestic rice prices. (This article will be published in the A03 edition of the Grain and Oil Market News on April 13, 2024)
Source丨Grain and oil market newspaper
General Duty丨Liu Xinhuan Editor丨Congshen
