US rice futures extended their run of records on Friday, surging by almost 4 percent as the scramble to bolster stockpiles of Asia's staple food showed little signs of abating.
Chicago Board of Trade July rough rice futures rose to $24.550 a hundredweight in Asian trade, a fourth successive record high, taking this year's gains to over 76 percent amid aggressive Asian demand and global unease over shrinking food supplies after several big suppliers cut back on exports.
Tightening supplies were evident in the Philippines, the world's biggest rice importer, where authorities received offers for only 325,750 tonnes of rice in a tender for 500,000 tonnes, the third time in a row it has failed to secure the full amount.
On top of that, rice planting in several US states, including top producer Arkansas, is off to a slow start due to overly wet conditions.
Although the United States is not a major exporter, many buyers are looking to US shipments to partly make up for curbed output from Vietnam, India and elsewhere.
Analysts warned that the world faced high rice prices for the foreseeable future. "Rice's rise shouldn't be seen as temporary, but part of the bull market that has hit commodities across the board," said Akio Shibata, director at Marubeni Research Institute in Tokyo.
"It is likely to stabilise at a high level, or even move higher," he said. "Supply just cannot keep up with demand."
In Asia, rice is far more than just a commodity. "Countries are racing to ensure they have enough supplies to feed their own population, and exporting only the surplus," Shibata said.
In Chicago trading on Thursday, rice futures had risen by their maximum allowed limit of 75 cents. The limit was expanded to $1.15 for Friday trading.
Rice is leading the commodities charge this year, picking up from wheat, which doubled between September and February this year before falling back by around 30 percent.
Traders are now watching to see if wheat picks up again. "You would wonder whether that spills back over into wheat at some point," said MF Global trade Pat Cogswell. - Reuters