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CBOT rice at 6-week high amid commercial activity

CHICAGO: Rough rice futures at the Chicago Board of Trade finished higher on Tuesday, reaching the highest levels in more than six weeks on indications of commercial demand.

CBOT rice settled 4 to 11 cents per hundredweight (cwt) higher, with March up 11 at $5.69, the contract's highest close since Dec. 13.

Futures activity Tuesday suggested some export-related commercial business, CBOT traders said.

Term Commodities bought about 150 March and May contracts combined, floor sources said.

"It seems like there might be some cash business they're doing," one CBOT trader said. "I think it would definitely be export-related, but we don't know to whom."

Jack Scoville, a trader with Price Futures Group in Chicago, said cash rice markets were active. Scoville also noted expectations for lower U.S. rice acreage this year.

"There is some talk on the floor that planted area could drop by as much as 20 percent if prices do not improve, especially on spreads against the other markets," Scoville said in a report Tuesday.

In 1999, U.S. farmers planted 3.58 million acres to rice, according to the U.S. Agriculture Department.

Rosenthal Collins sold 75 to 100 March contracts early, traders said, while ADM Investor Services was a light buyer.

Rice futures volume in Tuesday's pit session was estimated by the CBOT at 1,000 contracts, compared to 602 Monday.-Reuters