Rising demand for U.S. rice maygradually reduce surpluses while a marketing loan should help
increase the U.S. share of the world rice market despite
sluggish trade this year, the U.S. Agriculture Department said.
    In its quarterly rice outlook and situation summary, the
department said U.S. rice use may surpass production during the
1986/87 marketing year, causing stocks to fall about 10 mln
hundredweight from a year earlier to an estimated 67 mln cwt on
July 31.
    Long grain acreage as a percentage of total acreage is
expected to decline this year, the report said.
    USDA said factors once supportive of increased long grain
acreage have turned around. Domestic prices of medium grain
relative to long grain have increased, the loan differential
has been greatly reduced and increases in long grain yields
relative to those of other classes have leveled off.
    With the drop in domestic prices resulting from the
marketing loan, domestic rice use is expected to grow at a
faster rate, USDA said.
    "Development of new products and increased promotion have
helped make rice more available and visible to a wider range of
consumers," USDA said.
    USDA said world trade is expected to fall in 1987 because
of large production and stocks but a weaker market should
affect competing exporters more than the U.S.
    "The United States has already recovered a substantial share
of the European Community market and made inroads into markets
in the Middle East and Africa," the report said.
    World rice consumption is projected to reach record levels
in 1986/87, the report said, as higher per capita incomes,
increased domestic production and low import prices have
allowed people in many countries to substitute rice for coarse
grains.
    China, India and South Korea have increased output, while
the Middle East and Africa have doubled imports since the
mid-1970s, the report said.
 Reuter
