Chicago Board of Trade rough rice futures fell on Tuesday on a technical setback after climbing for the past week as funds covered short positions, traders said. March rice closed 5-1/2 cents lower per hundredweight at $6.71-1/2. The deferred were 3-1/2 to 4 cents lower. Trade was thin amid little fresh news. The CBOT estimated volume at 278 futures and 70 options. That compared with 948 futures traded on Monday.
Funds continued to roll their March positions before first notice day on February 28. "The hottest topics in the rice trade are the continuing dialogue of Iraq business and dismay about presidential cuts in agricultural subsidises for crops," said one cash-connected trader.
Hopes continue that US exporters will seal a deal to sell rice to Iraq. But no sales have been confirmed, even though the talk has been lingering for two months.
A US rice sale to Iraq would be the first such event in 15 years. Warmer, spring-like temperatures this week in Arkansas, the No 1 rice producing state, were starting to spur talk of how many acres US farmers would seed to rice.
Low commodity prices across the board plus concerns about soyabean rust were expected to play heavily on farmers' planting decisions. Arkansas farmers can start seeding rice by late March if fields dry out by then.
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