Rice export outlook lower for 2021

Despite near-record demand for U.S.-grown rice in 2020, the latest U.S. Department of Agriculture’s World Agriculture Supply and Demand Estimates (WASDE) Report lowered U.S. rice export projections for the 2020/21 marketing year. The estimated international shipments reflect a nearly 5 percent reduction from the June 2020 WASDE Report at 3.14 million metric tons (MT) to 2.99 million MT.

While the projected export levels for 2020/21 are even with that of the 2019/20 marketing year, they fall far short of where they could be given the significant increase in the 2020 harvested acres following hundreds of thousands of rice acres being prevented from planting in 2019. On a calendar year basis, 2020 falls even further behind 2019 figures. U.S. Census Bureau trade data shows 3.25 million MT of U.S. rice exported between January and November in 2019, compared to 2.84 million MT for the same period in 2020.

“This drop in overall exports for the calendar and marketing year can be attributed to a variety of factors, beginning with price, which was higher than normal the first nine months of the year because of the tight supply,” said Sarah Moran, USA Rice vice president, international. Once harvest hit, prices started to level out, but the U.S. missed some key business amid the global panic for staple foods resulting from COVID-19.

“In addition to the price factor, some key long grain markets like Iraq, Haiti, and Mexico have underperformed this year,” said Moran. “All of our primary markets were impacted differently by COVID-19, driving demand for retail but also reducing liquid capital to make purchases. We are optimistic that we’ll see demand pick up in those markets and we’ll be able to regain some ground."

To that end, USA Rice President & CEO Betsy Ward met virtually with Katherine Tai, President Joe Biden’s designee to serve as U.S. Trade Representative. Tai briefed Ward and other members of the Ag CEO Council on the incoming administration’s trade agenda and showed deep understanding of the importance of trade for the agricultural sector.

Tai is currently chief trade counsel for the House Ways and Means Committee and served in USTR’s Office of the General Counsel, first as associate general counsel from 2007 to 2011 and then as chief counsel for China Trade Enforcement with responsibility for the development and litigation of U.S. disputes against China at the World Trade Organization (WTO). In that
capacity she worked firsthand on U.S. WTO cases for rice and other agricultural commodities against China, and has kept abreast of developments there in her current role in Congress. “This meeting was a great opportunity to remind Ms. Tai of the challenges rice faces in global trade, including the need for sound, market-opening trade agreements and strong enforcement of WTO rules that limit domestic subsidies and prohibit other forms of trade manipulation that
help keep us on a level playing field with production giants like China and India,” Ward said. “Tai’s knowledge of the rice sector and her work on the China cases at their inception should serve us well in the new administration.”

The Ag CEO Council, composed of leaders of some of the largest agricultural and farm organizations in the U.S., discussed many topics including re-engaging with the WTO, new free trade agreements with the UK and Kenya, and the importance of the Asia Pacific region as a customer for U.S. agricultural products. 

Participants raised the importance of utilizing the USTR’s advisory system for regular engagement on trade policy issues with the private sector. For agriculture, these are the Agricultural Trade Advisory Committees (ATACs) and the Agricultural Policy Advisory Committee (APAC). The rice industry, through USA Rice, has positions on both with Peter Bachmann, USA Rice vice president of international trade policy, serving on the ATAC, and Dow Brantley, past-chair of USA Rice, serving on the APAC. Tai agreed that these advisory
committees need to be fully engaged in the dialogue about the Biden Administration’s trade agenda.

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