Summary - 1991 rice production expected to increase due to projected rise in harvested acreage and yields; USDA's weather bulletin rates 1991 rice crop 4% excellent condition, 65% good and 30% fair; U.S. rice supplies and imports expected to increase while exports forecast down; per capita consumption in U.S. continues to rise with carryout stocks forecast to remain the same as previous year; world rice production forecast down with largest declines expected in China and India; foreign rice exports projected up 3% - U.S. Dept. of Agriculture, Economic Research Service report

Situation and Outlook Report: Rice, July, 1991

U.S. 1991 rice production is forecast to increase 1.7 percent from a year earlier to 157.5 million cwt. This gain is caused by a projected rise in harvested acreage and a likely increase in yields. USDA's June acreage report indicated that U.S. rice producers plan to harvest 2.83 million acres in 1991, 18,000 acres more than in 1990.

All of this increase is expected to occur in Arkansas and Missouri, offsetting reductions in California, Louisiana, Mississippi, and Texas. Last year, harvested acreage in Arkansas and Missouri was held down because heavy winds and rain caused some lodging. The results of USDA's first survey-based yield forecast for the 1991 crop will be available in August. USDA's weather bulletin rated the 1991 rice crop, as of July 14, to be 4 percent in excellent condition, 65 percent good, and 30 percent fair, about the same as a year ago. However, last year unfavorable weather at harvest reduced yields. Assuming normal weather through harvest, this year's rice crop in Northeast and Central Arkansas, where most of the crop is grown, is expected to be better than last year's rain-damaged crop. Also, the potential for a good ratoon crop in Texas is better than a year ago, because planting of the first crop was not delayed in the western region where ratoon cropping is practiced. However, areas in Mississippi, Louisiana, and eastern Texas where rice planting was delayed because of persistent rainfall could suffer some yield loss. U.S. rice supplies are forecast to increase 3.2 million cwt in 1991/92 because of the forecast production increase. Imports are projected to continue trending upward, adding 5.5 million cwt to domestic supplies in 1991/92. Food use for 1991/92 is forecast up 6 percent, based on trend increases. USDA's biannual milled-rice distribution survey for marketing year 1988/89 was completed in early 1991. Overall survey results indicated that total and per capita consumption in the United States continued to rise. The growth in use of certain processed foods and some specialty rices was substantially greater than overall growth. U.S. rice exports in 1991/92 are forecast at 70 million cwt, down slightly from 1990/91. Strong competition and relatively tight U.S. supplies are likely to constrain exports, particularly in the last half of the marketing year. Continued strong demand from Latin America will help maintain U.S. market share, as will the continued use of government programs, including the Export Enhancement Program, credit guarantees, and food aid. Carryout stocks for 1991/92 are forecast to remain at 26.2 million cwt, the same as last year. This would be the fourth consecutive marketing year that carryout stocks would be below 27 million cwt and the stocks-to-use ratio below 17 percent. U.S. farm prices are currently forecast to range between $6.00 and $8.00 per cwt in 1991/92, compared with an estimated range of $6.50 to $7.00 for the current marketing year, and $7.35 in 1989/90. If world prices remain near 1990/91 levels and U.S. supplies stay tight, the differential between global and domestic prices will remain high, contributing to a continued weak outlook for U.S. exports. World rice production in 1991/92 is forecast at 344 million tons (milled), down 1 percent from the previous year, with the largest declines expected in China and India where record yields boosted supplies in 1990/91. World consumption is also projected down marginally. World trade in calendar 1992 is projected up 2 percent from 1991 to 12.9 million tons. Ending stocks and the stocks-to-use ratio are projected down slightly. Foreign rice exports are projected up 3 percent to 10.6 million tons, with the largest gains expected in Thailand. U.S. exports in calendar 1992 are projected at 2.3 million tons, down 4 percent from 1991 and market share is projected to decline from a forecast 19 percent in 1991 to 18 percent in 1992.