Concentrated rotation of paddy rice will bring greater pressure to the market

Since March, many provinces in the south have already begun clearing warehouses to make room, and the concentrated rotation period for paddy rice is about to arrive. As domestic paddy rice stocks are sufficient and imported rice continues to flow into the domestic market, the entry of old rice into the market through rotation will inevitably increase supply pressure on the paddy rice market, especially the southern indica rice market. At present, the price of new rice produced in 2014 in the southern market is relatively stable, but because the policy-based procurement period has already ended, and the transaction prices of old rice that has recently begun rotation are relatively low. It is expected that indica rice market prices will face certain downward pressure in the later period.

Production conditions in southern indica rice producing areas are generally suitable; since March, early rice sowing and seedling raising work in the south has been carried out successively. At present, early rice in northern South China and southern Fujian and single-season rice in central and northern Yunnan and eastern and southern Sichuan Basin have begun sowing and seedling raising; early rice in southern South China and single-season rice in southern Yunnan are at the emergence to three-leaf stage, and early rice in most of Hainan has entered the tillering and jointing stage. The Central Meteorological Observatory predicts that in mid-to-late March, heat conditions in most of South China will be favorable for early rice sowing and seedling raising; local heavy rain in northern South China will be slightly unfavorable for early rice sowing.

Policy-based paddy rice transactions continued this week. The total amount of policy-based paddy rice put on the market this week was about 1.8 million tons, including about 500,000 tons of early indica paddy rice produced in 2013 and about 1.3 million tons of mid-to-late indica rice. In the end, all early indica paddy rice failed to sell, and the transaction volume of mid-to-late indica rice was only more than 10,000 tons, less than last week. As the concentrated rotation period for paddy rice approaches, the sluggish transaction situation for policy-based paddy rice will continue.

As of now, the transaction volume of indica rice produced in 2013 through regular competitive bidding auctions has reached 2.67 million tons, of which the transaction volume of early indica rice was about 130,000 tons and the transaction volume of mid-to-late indica rice was about 2.55 million tons. Adding the transaction volume from the special competitive bidding sales in January, the total transaction volume of early indica rice produced in 2013 was about 810,000 tons, and the transaction volume of mid-to-late indica rice was 3.26 million tons.