Rice prices rise in India as demand recovers; Thai prices dip ahead of harvest

11:31 | 08/05/2018 Global Economy

Rice export prices in India rose as demand picked up, while rates for the Thai variety eased amid prospects of a healthy harvest, even as top exporters looked to clinch a possible deal with the Philippines.

Farmers harvest rice on a field in the outskirts of Hanoi - Photo by AFP

Rates for India’s 5 percent broken parboiled rice rose from the 4-1/2 month lows hit last week, gaining US$3 to US$412-$416 a ton, as demand improved from African buyers.

“Indian rice is currently very competitive compared with supplies from Thailand and Vietnam,” said an exporter based at Kakinada in the southern state of Andhra Pradesh.

A weaker Indian rupee had allowed exporters to lower prices in the past few weeks.

India’s exports jumped by 18 percent from a year ago to a record 12.7 million tons in the 2017/18 financial year to March 31, lifted by demand for non-basmati rice from Bangladesh, Benin and Sri Lanka.

However, imports by neighboring Bangladesh, which emerged as a major buyer last year after flood damage to crops, will slow in the coming months due to good crops this summer, said Badrul Hasan, head of Bangladesh’s state grain buyer.

Rice at government warehouses stood at nearly 1 million tons, boosted by record imports of about 3.7 million tons in the 10 months to April, Bangladesh’s food ministry data showed.

Meanwhile, Vietnam’s 5 percent broken rice prices were unchanged at US$445-US$450 a ton.

“The Ministry of Industry and Trade assigned state-run Northern Food Corp (also known as Vinafood I) to join a bidding round for 250,000 tons to be opened by the Philippines and other exporters have been advised not to participate,” said a trader in Ho Chi Minh City.

The Philippines’ state agency has issued international tenders to purchase 500,000 tons of rice, European traders said. A separate tender for 250,000 tons has been issued, open only to Vietnam and Thailand.

Vietnam’s exports in the first four months of 2018 were forecast to have risen by 22.3 percent from a year earlier to 2.17 million tons, according to the government’s General Statistics Office.

Prices for Thailand’s 5 percent broken rice dropped to $430-$445 a ton, free on board (FOB) Bangkok, from US$440-US$445 last week.

This was because of speculation of ample supply from the harvest expected around the end of May or early June, one Bangkok-based trader said.

Traders said they are still fulfilling shipments to Indonesia and anticipating the Philippines’ tender.

“Prices have stabilized over the past few days, since there were no big orders from abroad,” another trader said.

Thailand’s commerce ministry said that the country will offload two million tons from state stockpiles by the end of the year.

Theo Vnexpress/Reuters