Follow us on: Facebook Twitter YouTube

Rice farmers feel optimistic as 2011 planting begins

Issue Date: May 4, 2011
By Steve Adler
Chris Crutchfield, president and CEO of American Commodity Co. in Williams, says there is a feeling of optimism within the state’s rice sector from the farmers to the marketers.
Photo/Steve Adler
Two pieces of equipment make field passes at the same time on this parcel near Williams, as farmers prepare rice ground for planting.
Photo/Steve Adler

After another slow start resulting from cool, wet spring weather, Sacramento Valley rice fields have become a beehive of activity in recent days, as farmers take advantage of dry fields and perfect weather to prepare their ground for planting this year's crop.

Some fields have already been planted and farmers have reached the halfway point in ground preparations.

Mike DeWit, who grows about 600 acres of medium grain rice in Elverta, said he's "right in the middle of the planting season." As was the case last year, the season has started slowly.

"I would say we are about a week to 10 days behind where we would like to be traditionally, as opposed to last year when we were at least two to three weeks behind and it did result in yield losses of 10 to 15 percent," DeWit said. He said a strong north wind last week was "really going to dry the ground up, so that's a plus. On the other hand, there may be some planted fields for other growers that could be problematic because these north winds will blow all the seeds to the south end of those fields."

DeWit said rice growers are feeling the financial impact of high prices for diesel fuel and petroleum-based fertilizers, but he said it doesn't pay in the long run to cut corners.

"I would like to take shortcuts as far as field operations go, but I would pay for it in the end with the yield loss. I cannot afford to do it because I need those yields," he said.

The U.S. Department of Agriculture National Agricultural Statistics Service projects California planted acreage this year to be 575,000 acres, up 8 percent from the 558,000 acres harvested last year.

This year's estimate, which is based on a survey of California growers, is for 530,000 acres of medium grain; 40,000 acres of short grain; and 5,000 acres of specialty and long grain.

"I'd like to plant a little more," DeWit said, "but ground was just not available for me in my operation. We hope prices stay firm. Since 2008, the rice prices have been really good for us."

Chris Crutchfield, president and CEO of American Commodity Co. in Williams, said he thinks the USDA acreage projection for this year may be high and that the final planted acreage will be closer to 560,000 acres.

"Rice growers are very optimistic that they will be able to continue to produce a profitable crop. That doesn't mean we will return to 2008 when we had prices well over $1,000 a ton, and in excess of $1,200 in the summer of 2008. Right now for a very basic export Cal Rose product, you are looking at prices of $850 to $900 a ton (freight on board) California," he said.

Crutchfield said the marketing year for the 2010 rice crop is at the halfway point and sales have been positive.

"Prices aren't out of this world like they were in 2008, but they are firm and I think the rice industry is California is profitable for everyone involved, from the producers all the way up through the distributors," he said.

ACC mills rice for shipment throughout the United States as well as to international markets. According to Crutchfield, about 60 percent of California-grown rice is exported, with 80 percent being medium grain rice. The big volume is Calrose that is grown for export to Northeast Asia (Japan, Taiwan and Korea) as well as the Mideast and Northern Africa, which stretches all the way from Libya, through Egypt, Saudi Arabia, Jordan, Syria, Lebanon, Israel, Turkey, Kuwait and the United Arab Emirates.

Recent political unrest and hostilities in that area have created some challenges and bottlenecks for rice shipments.

"The Egyptian export ban on rice has resulted in the Libyan market opening up for California rice. Midway through the shipping season, the president issued an executive order establishing trade sanctions and there was a time when we had to go though a political process to get export licenses issued. But that trade has resumed," he said.

Crutchfield said rice exported to Libya goes to a private food distribution organization.

"It is my understanding, especially in Libya, that we are over there with all of our allies assisting the people. One of the things they need more than anything is food and they aren't producing it themselves," he said.

Bob Cummings, senior vice president of the USA Rice Federation, noted that California's principal rice export markets—Japan, Korea, Taiwan and Turkey—entered 2011 with strong tailwinds. The three Asian markets have made commitments to the World Trade Organization to import minimum amounts of rice and, for Taiwan and Korea, to buy a minimum portion from the United States.

"Nonetheless, sales do not come easily because protectionist sentiments are strong and potent in the domestic politics of each country," he said.

Sales to Japan totaled 317,200 metric tons at the conclusion of the Japanese government's fiscal year at the end of March, and the U.S. share of Japan's rice imports for 2010/11 stood at just less than 47 percent.

The Taiwanese government finished 2010 with 64,634 metric tons of rice purchased, which is the amount specified for government purchases from the U.S. Korea purchased 93,719 metric tons of U.S. rice last year, nearly double the U.S.-specific quota.

Rice exports to Turkey are off so far this year, following strong sales in 2010, due primarily to large rough rice sales of 383,930 metric tons that originated in California and the southern United States.

"Turkey is a medium grain consumer, and California has traditionally been the main U.S. supplier, but demand is price sensitive and can shift to Southern U.S.-origin medium grain, particularly for rough rice," he said.

While the state's agricultural water supply has greatly improved this year, Crutchfield said there is a common misconception among non-farmers that rice is a major water user.

"A rice field requires about five inches of water. Because the soil is extremely firm and hard, it holds the water very well, much like a swimming pool," he said. "The water is sitting there all summer long, but it is the same water that was put on it at planting time. It takes a lot more water to take care of a suburban lawn than it does to grow a crop of rice."

(Steve Adler is associate editor of Ag Alert. He may be contacted at sadler@cfbf.com.)

Permission for use is granted, however, credit must be made to the California Farm Bureau Federation when reprinting this item.




Special Reports

Features

Series

Special Issues

Special Sections