Rice : CBOT Futures prices may fall 15%.
March 9, 2011 Leave a comment
We don’t see much rice price analysis, or maybe it is our poor local language skills limiting our intake of the good stuff, but for those interested in the price of rice futures, we are worried a breakdown is coming – which will see the CBOT Rice Futures (ZR0Y) for the continuous contract, fall from where they are now – US$ 13.4….a good 15% or so to nearer US$ 11.5.
A hedge, or a punt, whatever you like on the breakdown at 13.25 might be considered by some.
Now if farmers could hedge their exposure….like they do in the west……
If the commodity is to rebound, we will be looking for a weekly close at 14 or better, but unless it somehow moves north of 14.80, we think the chances are better for a short term pullback as compared to another rally.
Indeed, there is risk of a more significant pullback to 10 or so, albeit a purely technical view, with no consideration given to global supply & demand and stocks whatsoever.