The current downward trend in rice prices is due to a combination of factors, as estimates of post-pandemic economic recovery, lower consumption, and the trade balance shortage in 2021. June ended with a drop of almost 11% compared to May. Data were released by AgroConab. Despite low prices in June and high production costs, the scenario is positive for producers. With the prospect that the Brazilian currency will be stronger, the pace of exports is expected to decline, compared to last season. The projection is that Brazil will sell 1.3 million tons of rice in the 2020/2021 season. The season is expected to close with a surplus of 200 thousand tons, with imports reaching 1.1 million tons. In the macroeconomic analysis, the recovery of carryover stocks is also expected for 2021, as well as a retraction in consumption due to economic recovery estimates, considering the negative income elasticity of rice consumption.
Source: Universo Agro / DATAGRO (*Translated by Ia Niani)