U.S. long grain 2007/08 estimated ending stocks have only been lower twice since 1982. They were lower in 1995 and 2003.

USDA’s Prospective Planting Report shows in 2008 U.S. all rice acreage of 2.77 million acres, which is slightly higher than the 2007 acreage of 2.76 million acres. The report shows 2008 U.S. long grain rice planted acreage at 2.07 million acres, which compares to 2007 acreage of 2.063 million acres.

World rice supply is one issue of concern and world rice prices is another.

Many of the Asian countries are harvesting new crop rice, so global rice supply is expected to improve and remain at record levels. Global rice stocks are expected to improve but remain dangerously low. Remember, dangerously low global stocks have been the norm over the past 5 marketing periods.

Global rice supply then appears adequate, but will availability to needed countries and individual consumers become a bigger issue? I expect not, at least I anticipate global governments will take steps to limit severe supply availability problems.

If one assumes the global economy shakes off current economic weakness issues and regains trend economic growth, then the market would have to provide the U.S. and global rice producer a price adequate to cover the inflationary cost of production increases experienced since 2002.

The trend in U.S. rice prices remains up. Let me reiterate this emerging bull market in commodities will be dangerous for a number of reasons. Expect price volatility, expect corrections, almost no reasonable situation should be unexpected. Individuals should also seek professional assistance.

This has been Bobby Coats Extension Economist University of Arkansas Division of Agriculture.