Anhui glutinous rice market prices are bullish in the short term; how are farmers' planting returns?

Over the past two years, the glutinous rice market has behaved very differently from hybrid rice and conventional japonica rice, with its market price remaining relatively stable. This year, Anhui's glutinous rice has entered the full harvest period. What is the current market situation? And what changes are showing in farmers' planting returns?

Production areas see mixed harvests

In recent years, driven by the development of the yellow rice wine brewing industry, pastry making, and the food health products sector, market demand for glutinous rice has risen year by year, and the domestic glutinous rice planting area has continued to expand as a result. In Anhui Province, glutinous rice cultivation is mainly concentrated in the counties and cities along the Huai River such as Huaiyuan, Fengtai, Shouxian, and Huoqiu, and along the Yangtze River such as Wangjiang, Zongyang, Susong, and Wuhu.

Cui Beikui of Zhonghuang Village, Feihe Township, Huaiyuan County, planted 100 mu of glutinous rice this season. "I started harvesting glutinous rice on the 11th of this month. However much the rural broker takes, that's how much I machine-harvest," he told the reporter. This year's local weather conditions were fairly suitable for glutinous rice growth, and based on the current situation, the average yield of glutinous rice is 1500 jin per mu (wet rice, moisture content 30%), an increase of more than 50 jin per mu over last year. But glutinous rice growers in the areas along the Yangtze River in Anhui Province that were affected by the floods in early July were not so lucky. Yang Shanfa of Zhanghu Town, Wangjiang County, had all 200 mu of his glutinous rice affected by the disaster, with a final yield of only 800 jin per mu (wet rice, moisture content 30%), a reduction of more than 700 jin per mu compared with last year. Xu Pingdao, deputy general manager of Jinmai Group at Pujiwei Farm in Tongling City, told the reporter that the floods in early July submerged part of the farm's glutinous rice fields, and the continuous rain in late September also caused large-scale sprouting on the panicle and lodging in more than 30,000 mu of early-maturing glutinous rice, leading to a lower milling yield and reduced quality of the early-maturing glutinous rice. Based on the early-maturing glutinous rice already harvested, the average yield is 1000 jin per mu, a reduction of more than 30% compared with normal years. If the weather conditions later show no major anomalies, the 50,000 mu of late-maturing glutinous rice may be able to maintain a normal yield level.

Wu Pengling, president of the Grain Association of Jinshe Township, Zongyang County, Anhui Province, told the reporter that this year the township's glutinous rice planting area was 28,000 mu, accounting for more than 90% of the township's cultivated land. The entire Zongyang County has more than 1 million mu of cultivated land, of which about 800,000 mu is planted with glutinous rice. Due to the abnormal climate, all the glutinous rice fields in the polder area of Jinshe Township were flooded and had no harvest at all, and only 6,000-7,000 mu of early-maturing glutinous rice produced a crop, with an average yield of 1400-500 jin per mu (wet rice, moisture content 20-25%), a slight reduction from last year. Huaiyuan County is also one of Anhui Province's main glutinous rice planting areas. Because the comparative returns from planting glutinous rice are relatively high, the county's glutinous rice planting area this year was 830,000 mu, an expansion of 30,000 mu over last year, with an average yield of 550 kg per mu (standard rice), basically flat with last year.

Large gap in farmers' returns

Xu Pingdao told the reporter that at this time last year, the market purchase price of the new-season glutinous rice was 1.6 yuan per jin (dried rice, moisture content 14.5%), while this year it has risen to 1.9 yuan per jin. In Jinshe Township, the market purchase price of the new-season glutinous rice has also risen to 1.6 yuan per jin (wet rice), more than 0.4 yuan per jin higher than the same period last year. Similar to the glutinous rice market situation in the areas along the Yangtze River, Cui Beikui told the reporter that in Huaiyuan County the market purchase price of wet glutinous rice is about 1.4-1.5 yuan per jin, and the market purchase price of dried rice is about 1.8 yuan per jin, more than 0.2 yuan per jin higher than last year. In the Wuwei market, the market purchase price of the new-season glutinous rice is 171-176 yuan per 100 jin, with a moisture requirement of within 14%, and the market price rose by 2-5 yuan per 100 jin compared with the earlier period. Most of the grain supply is high-moisture grain with relatively high moisture content, requiring timely drying and conditioning. In Shucheng County, in October the market purchase price of glutinous rice was still maintained at 1.7 yuan per jin (standard rice), but after entering November, the market purchase price of glutinous rice quickly climbed to 1.85 yuan per jin (standard rice), an increase of 0.25 yuan per jin over the same period last year.

Although the glutinous rice market looks promising, the gap in farmers' planting returns has widened. Cui Beikui calculated for the reporter that this year planting glutinous rice requires an input of 18 jin of seed per mu, at 4.4 yuan per jin, for a seed cost of 79.2 yuan per mu; compound fertilizer and urea costs of 170 yuan per mu; pesticide costs of 100 yuan per mu; herbicide costs of 80 yuan per mu; agricultural machinery costs of 120 yuan per mu; labor costs of 80 yuan per mu; and land transfer fees of 500 yuan per mu, for a total input of 1130 yuan per mu. Calculating on the basis of a yield of 1500 jin (wet rice) and a market selling price of 1.4 yuan per jin, the output value per mu is 2100 yuan, and after deducting all expenses, the gross income per mu is 970 yuan. Compared with last year, this is an increase of about 90 yuan per mu. But the planting returns of farmers in the areas along the Yangtze River are not so rosy. "I worked for nothing this year." Yang Shanfa told the reporter that his input for planting glutinous rice was about 1100 yuan per mu, and calculating on the basis of a yield of 800 jin and a selling price of 1.25 yuan per jin, the output value per mu is 1000 yuan; not counting his own labor input and machinery wear and tear, the loss per mu is more than 100 yuan. Xu Pingdao told the reporter that even though glutinous rice prices have risen, local farmers' income per mu has fallen by 30%, and farmers' planting returns have also dropped by more than 500 yuan per mu.

Short-term market looks bullish

"Because downstream buyers generally expect a reduction in glutinous rice supply from the Anhui production area this year, merchants have all come to the production area in advance to stock up." Xu Pingdao believes that under this market expectation, the purchase price of glutinous rice was quickly pushed up in the earlier period, but it may not be maintained for too long. As buyers finish purchasing, glutinous rice prices may edge down slightly, and it is expected that glutinous rice prices will find it hard to climb further before the Spring Festival.

Xiang Kesuo, head of Nangang Rice Industry in Shucheng County, analyzed that market participants were generally optimistic about this year's glutinous rice market in the earlier period, and large amounts of social capital poured into the glutinous rice purchasing sector, causing the glutinous rice market to keep heating up. The current purchasing peak is nearing its end, and it is estimated that before the New Year the glutinous rice market should remain relatively stable, with no major fluctuations.