February 27, 2015

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Volume 5, Issue I
Daily Exclusive

ORYZA Rice
Newsletter

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UK Seeks New GM Crop Regulations from

EU
Feb 26, 2015

The United Kingdom has

moved a step forward
showcasing its interest
for Genetically Modified
(GM) crops. The EU
state has called for new
regulations,
which
apparently allow it to
conduct trials and grow
GM
crops.
The
Parliaments Science and
Technology Committee
has released a report on
the European Union's
(EU) existing GM regulations saying there is a need for a new trait-based system for regulating
new crop breeding technologies as the existing regulations prevent GM crops to be grown in the
UK despite being passed rigorous safety testing procedures, according to a press release on the
UK Parliament website.
The report indentifies three major flaws in the EU regulatory system for GM crops. First, the
current regulations are based on assumption that GM crops inherently pose greater risk that
traditional crops and fail to recognize the characteristics displayed by the GM crops in the field.
Second, they fail to assess the risks posed by the GM crops in relations with the benefits to the
producer, consumer and the environment leading to a one-sided judgement on their effects to the
economy, society and environment. Third, the current regulations prevent EU States from taking
their own decision on GM crops.
Due to this member states who basically oppose GM crops have been trying to influence other
members over the adoption of GM crops.The report concluded that the "Precautionary
Principle", which controls the import and cultivation of GM crops, is no longer valid as there has
been no significant evidence that there are potentially dangerous effects on the environment,
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human, animal and plant health from GM crops. Continued application of this principle is acting
as a barrier to progress in this field, stated the report

Philippines to Conduct Auction for 500,000

Tons of Rice on February 27, 2015
Feb 26, 2015

The Philippines will conduct an auction for 500,000 tons of rice on

February 27, 2015, Bloomberg quoted the Philippine Presidential
Adviser for Food Security as saying.The three countries - Thailand,
Vietnam and Cambodia - which have import agreements with the
Philippines will reportedly participate in the bidding.The imports are
to boost buffer stocks ahead of the lean season (June - August).
Earlier, a Reuters report noted that the National Food Authority (NFA) is planning to buy
250,000 tons of 25% broken rice and 250,000 tons of 15% broken rice and is seeking delivery of
half the volume by March 31, 2015 and the remaining half by April 30, 2015.
The Philippines imported around 1.8 million tons of rice (including around 1.5 million tons of
2014 imports and around 300,000 tons of 2013 residual imports) in 2014 to replenish rice stocks
and control price hikes. USDA estimates the Philippines to produce around 12.2 million tons of
rice, basis milled, in MY 2014-15 (July - June) and import around 1.6 million tons of rice in
2015.

U.S. Rice Producers Make Preparations to

Send Rice Samples to Cuba
Feb 26, 2015

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Rice producers in the U.S. Missouri state
have reportedly secured permission from the
U.S. Department of Commerce (USDC) to
ship one container of sample rice to Cuba
after the 50-year long trade embargo with
the Caribbean nation had been lifted,
according to local sources.They are waiting
for the USDC to grant permission to send its
second container as well. Missouri rice
producers are keen on shipping one
container with 40,000 pounds of rough rice (around 18 tons) and another container with 40,000
pounds of milled rice (around 18 tons).U.S. Senator Claire McCaskill, who has been guiding the
Missouri rice producers in overcoming the regulatory barriers to export rice to Cuba was quoted
as saying in the St.Louis Public Radio a couple of days earlier that the rice producers could
successfully obtain permission to ship a few containers of sample rice to Cuba. The Senator who
recently visited Cuba also spoke to the Cuban authorities about Missouri rice.She noted that next
month a delegation led by the Governor Jay Nixon will reach Cuba to attend the second round of
talks over the U.S. - Cuba trade. The first round of talks were held in Havana last month.
Representatives of all agricultural producers, including rice, will follow the Governor.Recently,
the U.S. has eased the existing financing and banking restrictions with Cuba allowing for the
revival of rice and other agricultural trade with the Caribbean nation.Cuba imports about 50% of
its annual rice consumption needs. USDA estimates Cuba to produce around 455,000 tons of
milled rice and import around 450,000 tons of rice in MY 2014-15 (July - June) to meet a
consumption demand of around 905,000 tons. Cuba currently imports rice from Brazil, India and
Thailand.

Myanmar Signs 100,000 Ton Rice Export

Contract with China
Feb 26, 2015

The Myanmar Rice

Federation (MRF) has
signed a contract with
the China's state run
China
National
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Cereals, Oils and Foodstuffs Corporation (COFCO) to export 100,000 tons of rice to China in
separate monthly shipments in accordance with market prices at the time of shipment, local
sources quoted an official from the (MRF) was quoted as saying.According to the Joint
Secretary of the MRF, it has been agreed to export rice in separate monthly shipments at the
prevailing prices at the time of shipment to ensure a fair trade for both parties. He also noted that
the Myanmar rice exporters do not have enough capacity to export all 100,000 tons of rice at
once.
Officials from the MRF have been working to sign this contract for last few months in order to
legalize rice exports to China.Initially nine companies were shortlisted to export rice to China
but the number is likely to go up as China seeks increase in the number of exporters in which it
will do business with.According to the agreement, rice exporters should get their rice inspected
and accredited with the China's General Administration of Quality Supervision, Inspection and
Quarantine (AQSIQ) and then seek approval from the China Certification and Inspection Group
before exporting rice to China.The MRF Joint Secretary noted that they would begin exporting
rice to China from April. He noted that the MRF is taking all measures to meet the quality and
variety standards in accordance with China's specifications.Currently export quotes for Myanmar
5% broken rice are at around $415 per ton and 25% broken rice is quoted at around $325 per ton.
Around 1.1 million tons of rice have been exported from Myanmar in the first nine months of
2014-15, including 800,000 tons to China through border trade. The Myanmar government is
targeting to export around 2.5 million tons of rice in FY 2015-16 (April - March), up about 67%
from an estimated 1.5 million tons in FY 2014-15.USDA estimates Myanmar to produce 18.98
million tons of paddy rice (around 12.15 million tons, milled basis) and export around 1.4
million tons of rice in MY 2014-15 (January - December 2015).

Oryza Overnight Recap Chicago Rough

Rice Futures are Seen Lower Overnight
ahead of Weekly Export Sales Report and as
Crude Turns Negative Once Again
Feb 26, 2015

Chicago rough rice futures for May delivery are currently listed 12 cents per cwt (about $3 per
ton) lower at $10.650 per cwt (about $235 per ton) ahead of floor trading in Chicago. The other
grains are seen mixed this morning: soybeans are currently seen about 0.3% higher, wheat is
listed about 0.4% lower and corn is currently noted about 0.6% higher.U.S. stock index futures
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signaled a softer open on Thursday as investors digested mixed U.S. data that was mostly worse
than expectations. The core CPI, the key figure for the Fed that excludes more volatile food and
energy prices, gained 0.2%. However, CPI data for January was down more than expected at
0.7%.
Expectations were for a further sharp drop of 0.6 percent month on month, the biggest fall since
2008, driven by energy prices to leave the year-on-year rate in negative territory. Durable goods
orders figures for January increased a more-than-expected 2.8%, after a 3.4% decline in the prior
month. Initial claims for unemployment for the week of Feb. 15, came in at 313,000. Analysts
had expected the figure to increase moderately to 285,000 from 283,000 the week prior. Earlier,
futures pointed to a higher open as investors welcomed comments from U.S. Federal Reserve
Chair Janet Yellen's speech to Congress, which hinted that the central bank was not in a rush to
hike interest rates.
U.S. stocks closed narrowly mixed on Wednesday, after struggling for direction amid firming
oil prices and some debate over the tone of Yellen's congressional remarks. Gold is currently
trading about 1% higher, crude oil is seen trading about 2.6% lower, and the U.S. dollar is
currently trading about 0.7% higher at 8:00am Chicago time.

Oryza U.S. Rough Rice Recap - Prices Slip

Slightly as Long Export Sales Disappoint
Feb 26, 2015

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The U.S. cash market was slightly weaker again today as long grain export sales continue to
disappoint and buyers show little to no interest in this market despite it being the cheapest rice in
the western hemisphere.In the meantime, the USDA reported that cumulative net export sales for
the week ending on February 19 totaled 95,400 tons, which was 3% lower than last week but
20% higher than the prior 4-week average.
Increases were reported for the following destinations: 48,200 tons to Japan, 16,200 tons to
Mexico, 8,100 tons to Saudi Arabia, 7,400 tons to Haiti, and 5,200 tons to Jordan.U.S. rice
exporters shipped 93,700 tons, which was considerably higher than last week and the prior 4week average. The primary destinations included 38,200 tons to Mexico, 27,500 tons to
Colombia, 20,900 tons to Haiti, 2,200 tons to Jordan, and 1,500 tons to Canada.

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Oryza Afternoon Recap - Chicago Rough

Rice Futures Fall Despite Strong Export
Sales and Rallying Grains
Feb 26, 2015

Chicago rough rice futures for May delivery settled 11.5 cents per cwt (about $3 per ton) lower
at $10.655 per cwt (about $235 per ton). The other grains closed higher as corn and wheat were
both lifted out of negative territory by surging beans; Soybeans closed about 1.6% higher at
$10.2650 per bushel; wheat finished about 0.7% higher at $5.0050 per bushel, and corn finished
the day about 1.2% higher at $3.8850 per bushel.
U.S. stocks traded in a narrow range on Thursday, with only the Nasdaq holding higher, as
investors digested mixed economic data and declines in oil. Crude oil traded below $50 a barrel
and Brent held near $61 a barrel on Thursday. he core Consumer Price Index, the key figure for
the Fed that excludes more volatile food and energy prices, gained 0.2% in January. However,
the broader index was down more than expected at 0.7%. Expectations were for a further sharp
drop of 0.6% month on month, the biggest fall since 2008, driven by energy prices to leave the
year-on-year rate in negative territory.
Durable goods orders figures for January increased a more-than-expected 2.8%, after a 3.4%
decline in the prior month. Initial claims for unemployment for the week of Feb. 15, came in at
313,000. Analysts had expected the figure to increase moderately to 285,000 from 283,000 the
week prior. The Dow Jones Industrial Average traded down 7 points, or 0.04%, to 18,217. The
S&P 500 traded down 3 points, or 0.15%, to 2,110, with energy the greatest decliner and
information technology leading four sectors higher. The S&P 500 traded down 3 points, or
0.15%, to 2,110. Gold is trading about 0.7% higher, crude oil is seen trading about 4.6% lower,
and the U.S. dollar is seen trading about 1.1% higher at about 1:00pm Chicago time.
Wednesday, there were 2,098 contracts traded, up from 1,505 contracts traded on Tuesday. Open
interest the number of contracts outstanding on Wednesday decreased by 59 contracts to
9,121.

Oryza Global Weather Outlook

Feb 26, 2015

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Rain is expected across the Yangtze Valley and eastern South China this week.
Light rain showers are expected across India and Pakistan this week.
Weather is expected to remain dry in Bangladesh.
In Indonesia, rain is expected western and southern Sumatra, Kalimantan, south western East
Malaysia, Sulawesi, and Java this week.
Rain showers are expected in central and northern Vietnam, and south eastern Thailand this
week.
A few showers are expected in south eastern Philippines this week.
Rain is expected across the centre-south and north-east Brazil this week.
Rain showers are expected to increase across the Argentina and Uruguay rice areas this week.

Thailand to Auction One Million Tons of Rice

on March 6, 2015
Feb 26, 2015

The Thai government is planning to auction one million tons of rice on March 6, 2015, according
to Reuters.The government is expecting a good number of bidders in the upcoming auction and it
is planning to sell rice based on whole-warehouse basis. It is inviting bids for the March 6
auction on March 5, according to Bloomberg.Thailand sold about 500,000 tons of rice from the
one million tons of rice auctioned on January 29, 2015.
The government reiterated its plans to sell about 10 million tons of rice this year and about 7
million tons next year.

Indonesia's Plan to Replace Raskin Rice with

E-Money Invites Criticism
Feb 26, 2015

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Indonesia's plan to replace subsidized rice

for poor (Raskin) with E-Money has invited
criticism from an official from the Bank of
Indonesia, according to Reuters.The official
noted that the plan would trigger inflation in
the long run. He added that if the poor are
given money, they would be tempted to buy
rice from the open market instead of from
the Bulog leading to price pressure in the
market. Further, the government may lose its
authority of controlling the price of rice, he
said. The official also noted that the people
may also use the money for other purposes as well. He therefore noted that the plan would be
fruitful if the government can control its use. He added that the e-money concept is better than
giving cash as people tend to use e-money in a more conservatory manner.

India Average Wholesale Rice Prices Decline

Sharply in February 2015
Feb 26, 2015

India average wholesale rice prices, which increased in January 2015 after declining for two
consecutive months have again declined in February 2015 due to increased supplies and
declining export demand, according to official sources.Average monthly wholesale rice prices in
India declined to around Rs.2,709.78 per quintal in February 2015, down about 4% from around
Rs.2,836 per quintal in January 2015, and down about 2% from their year-ago levels of around
Rs.2,761.2 per quintal.
In terms of USD per ton, wholesale rice prices in India stand at around $438 per ton (using
current exchange rates) in February 2015, down about 5% from around $461 per ton (using
historical exchange rates) in January 2015, and down about 1.5% from around $445 per ton
(using historical exchange rates) in February 2014.

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The government of India, in its second advance estimates for major crops, has estimated India's
rice production for 2014-15 marketing year (October 2014 - September 2015) at around 103.04
million tons, down about 3% from an estimated 106.65 million tons in 2013-14, according to a
statement from the agriculture Ministry this month. The government of India is estimating 201415 (April 2014 - March 2015) rice exports, including basmati and non-basmati, at around 10.1
million tons, down about 7% from around 10.9 million tons exported in 2013-14.
USDA estimates India's 2014-15 (October - September) production at around 102 million tons,
down about 4% from an estimated 106.54 million tons in 2013-14. It estimates Indias rice
exports to decline about 16% y/y to around 8.7 million tons in 2015 from an estimated 10.3
million tons in 2014.

India Basmati Rice May Not Get Legal

Protection Soon
Feb 26, 2015

The Intellectual Property Appellate Board (IPAB) has

accepted the petition of Pakistan's Basmati Grower's
Association (BGA) opposing the granting of Geographical
Indications (GI) tag for India's basmati rice, a move that
could delay India's basmati rice getting a legal
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protection.The IPAB also considered the petition by farmers' body in the Central Indian State
Madhya Pradesh, which sought inclusion of Madhya Pradesh in India's basmati application.
In 2009, the Agricultural and Processed Food Products Export Development Authority (APEDA)
applied to the GI Registry in Chennai seeking GI protection for India's basmati rice. However,
based on complaints from the Madhya Pradesh department of farmer welfare and agriculture
development and some basmati exporters in the state, in December 2013, the GI Registry
directed the APEDA to file an amended GI application to include Madhya Pradesh as a basmati
growing area.Not convinced by the GI Registry's directive, the APEDA approached the
Intellectual Property Appellate Board (IPAB) in February 2014 to decide over the inclusion of
Madhya Pradesh in its Geographical Indications (GI) application. The APEDA has been very
keen on not including other basmati growing states, other than those recognized by National
Agricultural Research System under the agriculture and co-operative department, in its
application as it views the GI status is critical in determining the genuine basmati rice cultivators.
However, the farmers' body in Madhya Pradesh and the BGA also appealed against the APEDA
with the IPAB.A GI label certifies the geographical origin of a product and confirms adherence
to some production standards. It also prevents producers who aren't covered by the tag from
using the same.

Government of India to End Levy Rice

Procurement from 2015-16 Marketing Season
Feb 26, 2015

The government of India has decided to end the levy rice

procurement system starting from the 2015-16 (October September) marketing season to ensure better prices to
farmers, local sources quoted a communication from the
Food Ministry as saying. Under the levy rice procurement
system, millers purchase paddy from farmers at minimum
purchase price (MSP) and the state governments in turn
procure milled rice from millers to meet their public
distribution needs. Percentage of levy rice procured from
millers differs from state to state and used to be in the range of 30-75% of total procurement in
respective states. However, in August 2014, the government of India capped the levy rice
procurement from millers at 25% for the 2014-15 procurement season.Usually about 5 million
tons of milled rice are procured annually through levy system from millers. The rice thus
procured was directly handed over to public distribution system (PDS) operators. The millers
were also happy as they used their installed capacities optimally.However, the government of
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India felt the need to abolish the levy rice procurement as there was no proper supervision
system and the millers were often not paying MSP to the farmers and were selling the betterquality grain in the open market. Therefore the Food Ministry opined that the actual purpose of
levy rice system to bridge the capacity gap with government procurement agencies is not being
fulfilled.
With the abolition of levy rice system, the government mandates the Food Corporation of India
(FCI) and state procurement agencies to step up their procurement operations as well as entirely
adopt the custom milled rice (CMR) under which they would directly buy paddy from farmers
and get it milled from registered millers. This would ensure payment of MSP to farmers and
remove some irregularities in the levy rice procurement.Major rice producing states such as
Punjab and Haryana had abolished the levy rice system two years back but it still exists in the
states of Uttar Pradesh, Uttarakhand, Andhra Pradesh, Telangana and West Bengal.
The decision is being hailed by some rice market veterans. It is a step in right direction, finally
moving away from controlled system to somewhat free markets. The rice millers will have
freedom to sell in the market, which should ultimately help farmers getting a better price, a
former chairman, Commission for Agricultural Costs and Prices (CACP) was quoted as
saying.The Indian government targets to procure 30.05 million tons of rice during the 2014-15
Kharif Marketing Season (October 2014 - September 2015), down about 12% from last year's
target of around 34.3 million tons.Asia rice sellers kept their quotes mostly unchanged today.
5% Broken Rice
Thailand 5% rice is quoted at around $405 - $415 per ton, about $45 per ton premium on
Vietnam 5% rice shown at around $360 - $370 per ton. India 5% rice is quoted at around $390 $400 per ton, about $55 per ton premium on Pakistan 5% rice quoted at around $335 - $345 per
ton.
25% Broken Rice
Thailand 25% rice is quoted at around $365 - $375 per ton, about $30 per ton premium on
Vietnam 25% rice shown at around $335- $345 per ton. India 25% rice is quoted at around $355
- $365, about $50 per ton premium on Pakistan 25% rice quoted at around $305 - $315 per ton.
Parboiled Rice
Thailand parboiled rice is quoted at around $405 - $415 per ton. India parboiled rice is quoted at
around $385 - $395 per ton, on par with Pakistan parboiled rice quoted at around $385 - $395 per
ton.
100% Broken Rice
Thailand broken rice, A1 Super, is quoted at around $320 - $330 per ton, about $15 per ton
premium on Vietnam 100% broken rice shown at around $305 - $315 per ton.
India's 100% broken rice is shown at around $280 - $290 per ton, about $5 per ton premium on
Pakistan broken sortexed rice quoted at around $275 - $285 per ton.

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