Rice/CEPEA: Conab Auctions Reduce Spot Market Liquidity

According to a report from the CEPEA research center at the University of São Paulo, the spot market for paddy rice in Rio Grande do Sul, Brazil, is currently experiencing slow trading activity. With the conclusion of the 2025/26 harvest season in the state, both producers and buyers are maintaining a cautious stance. This hesitancy is attributed to the high supply volumes available and the persistent difficulties in passing on prices throughout the supply chain. Furthermore, market participants' attention in the past week has largely shifted towards the commercialization support auctions organized by Conab (National Supply Company). These auctions took place on May 26th. CEPEA researchers indicate that the channeling of a portion of the rice volumes into these subsidized operations has led to a noticeable reduction in activity within the spot market. The research center noted that these auctions occurred at a time of elevated supply, further influencing the dynamics of the immediate cash market.