Prices of rice plummeted to cap the longest streak of weekly losses since 2008 as the crop’s condition improved in the US and Thailand remained on course to become the world’s largest exporter.
Department of Agriculture data showed that, on June 1, 69% of US rice crop was assessed to be good or excellent, ascending for the second week in a row and hitting the highest percentage for the date since 2010.
According to CCTV, Thailand expects to ship 9 million tonnes of rice into global markets in 2014 to become the world’s number one exporter of the commodity.
Global food costs are being kept in check by rising supplies, with the United Nation showing that world prices dropped in May for a second month. The Standard & Poor’s GSCI Agricultural Index of eight crops declined for 6 consecutive weeks, the longest losing run since October 2011. A Bloomberg survey indicated that US farmers expect to harvest record volumes of corn and soybeans crops.
“U.S. crop conditions have been reported very good, and that has contributed to the speculative selling this week. Uncertainty about Thailand’s rice policies also helped to depress market sentiment,” Neauman Coleman of Brinkley, Arkansas-based Neauman Coleman & Co told Bloomberg.
July-delivery rough rice futures advanced 0.7% and traded at $14.175 per 100 pounds at close as of 1:15 pm on the Chicago Board of Trade. The price plunged 5.4% the week ended Friday 6, capping five losses in a row in the longest run of declines since August 2008.
On Thursday, the grain hit $14.07, the lowest level since June 18, 2012.
A USDA report showed last month that global stockpiles of rice will rise to 111.25 million tons, levels last seen 12 years ago.
A gauge of 55 food items declined 1.2% to 207.8 points, down from 210.3 points, restated in April according to UN data showed on Thursday.
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