SUMMARY OF CHANGES FOR THE MEDIUM AND SHORT GRAIN RICE PRICING METHODOLOGY (23-CEPPM0018)

(Released June 2022)

The following is a brief description of changes to the Medium and Short Grain Rice Pricing Methodology for the 2023 and 

succeeding crop years. Please refer to the Medium and Short Grain Rice Pricing Methodology document below for

complete information.

• Text and methodology changes are made under Section 2. Beginning in July 2020, the USDA’s Agricultural 

Marketing Service (AMS) ceased publishing monthly medium grain rice price quotes for Arkansas and California. 

RMA uses AMS weekly quotes beginning in July 2020. Weekly ratios are computed, as detailed below; monthly 

averages of the weekly ratios are then computed.

• The document was reformatted to be more consistent with other policy documents. 
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23-CEPP-M0018

(Released June 2022)

UNITED STATES DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

Medium and Short Grain Rice Pricing Methodology

RMA establishes distinct medium and short grain rice prices in accordance with the Common Crop Insurance Policy Basic 

Provisions and the Commodity Exchange Price Provisions: Section II – Rice (CEPP). The CEPP states that medium and short 

grain type rice prices are derived by applying a price factor “determined by RMA” to the exchange-based projected rice price and 

harvest rice price. The methods used to determine these factors are explained in this document. 

1. Overview

RMA utilizes the following sources: 

• National Agricultural Statistics Service (NASS) 

marketing year average rice prices (California: 

October-September).

• Chicago Board of Trade (CBOT) November rice 

contract, Rough Rice U.S. Number 2 or Better - long 

grain rice.

• Agricultural Marketing Service (AMS) weekly or

monthly reports for medium grain rice, U.S. Number 2 

- Arkansas and California. Note: Monthly reports are

used through June 2020, weekly reports are used 

thereafter.

Medium and short grain price factors are derived for: 1) all 

California counties; 2) other states, comprising all counties 

in Arkansas, Florida, Illinois, Louisiana, Mississippi, 

Missouri, Oklahoma, and Tennessee, as well as Texas 

Counties with a February 28 sales closing date; and 3) 

Texas counties with a January 31 sales closing date. These

factors are used to derive both medium grain type and short 

grain type rice prices, i.e., the same prices are used for both 

types. 

2. Price Factor Methodology for California

Ratios between the following data are derived for each year 

of the most recent five or ten years of data, depending on 

which time frame is used (RMA will annually assess price 

trends in recent NASS data to determine whether a fiveyear series (more likely with trending data) or a 10-year 

series (more likely with non-trending data) should be 

utilized): 

• NASS California rice price estimates.

• RMA rice harvest prices for California (RMA harvest 

price is the average daily settlement price during 

October for the nearby CBOT November Rice 

Contract). 

Yearly Ratios (i) = California NASS Price (i)/RMA Harvest 

Price (i). The California price factor is the average of the 

five or ten yearly ratios rounded to two decimal places. 

3. Price Factor Methodology for other states

Beginning in July 2020, monthly averages of weekly ratios 

between the following data are derived to obtain a monthly 

ratio: 

• The midpoint of Arkansas low-high bid prices from the 

AMS weekly rice report for medium class rice 

• The mid-point of California low-high bid prices from the 

AMS weekly rice report for medium class rice 

Monthly reports are used through June 2020.

The average of 12 monthly ratios (October-September of 

each year) provides a yearly Arkansas-California price 

factor. The most recent five or ten yearly ArkansasCalifornia price factors (RMA will annually assess price 

trends in recent NASS data to determine whether a fiveyear series (more likely with trending data) or a 10-year 

series (more likely with non-trending data) should be 

utilized) are averaged together to obtain the overall 

Arkansas-California price factor. 

The Other States price factor is the overall ArkansasCalifornia price factor multiplied by the California price 

factor, rounded to two decimal places. 

4. Price Factor Methodology for Texas counties

with a January 31 sales closing date

The price factor for Texas Counties with a January 31 sales 

closing date is derived using the OTHER STATES 

methodology described above. However, NASS does not 

release marketing year rice price estimates until the end of 

the following January. For example, the NASS California 

price estimate for the 2020-21 marketing year was not 

released until the end of January 2022. The projected price 

discovery period for Texas Counties with a January 31 

sales closing date ends January 14. Consequently, the 

latest NASS price estimate is not available in time for RMA’s 

release of the projected price. As a result, data used to 

derive the price factor for Texas Counties with a January 31 

sales closing date lags one year behind the data used to 

derive the other price factors. 

The price factor for Texas counties with a January 31 sales 

closing date is calculated using the same steps listed above 

for the Other States price factor but will use data from one 

year earlier since NASS data is not released by the start of 

the projected price discovery period.