March 29, 2018 / 11:19 AM / 4 months ago

India rice prices rise on muted supply; lack of deals weighs on Thailand

BENGALURU (Reuters) - Rice export prices rose in India this week on limited supply and improved demand, while a lack of fresh overseas interest weighed on the staple market in Thailand.

A woman spreads paddy crop for drying at a rice mill on the occasion of International Women's Day, on the outskirts of Agartala, India March 8, 2018. REUTERS/Jayanta Dey

In top exporter India, prices for the 5 percent broken parboiled variety rose by $6 to $425-$429 per tonne amid reduced supply.

Demand from African and Asian buyers has also been better than last week, said an exporter based in Kakinada in the southern state of Andhra Pradesh.

Meanwhile, neighbouring Bangladesh, which has emerged as a major rice importer since 2017 after floods damaged its crops, imported more than 3.5 million tonnes during the July to March period, and has already exceeded its previous annual import record, data from the country’s food ministry showed this week.

Bangladesh could buy more rice in the next few months, given the high prices in the domestic markets, a food ministry official said on Thursday.

Prices edged higher in Vietnam as well, with rates for the 5-percent broken rice rising to $410-$428 a tonne from $405-415 last week as farmers and agents slowed sales, in anticipation of potential overseas deals.

“Farmers and trading agents are still refraining from selling strongly as they are waiting for more information about government-to-government contracts, especially one with the Philippines,” a Ho Chi Minh City-trader said.

Vietnam exported 1.35 million metric tonnes of rice in the first quarter this year, up 9.1 percent from a year earlier, the government’s General Statistics Office (GSO) said on Thursday.

Rice export revenue in the January-March period rose 23.8 percent to $668 million, while shipments in March totalled 520,000 tonnes valued at $260 million, compared with 340,000 tonnes worth $169 million in February, the GSO said.

As for Thailand, prices of the benchmark 5 percent broken rice variety were in a $415-$435 per tonne range, free on board (FOB) Bangkok, compared with $430-$432 last week, amid a lack of fresh deals.

    “Many exporters are now looking for new deals in markets like Indonesia and the Philippines,” a Bangkok-based rice trader said.

“But demand remains flat and so far we are only shipping rice to China from old purchase orders.”

     Many exporters are buying up rice now due to speculation about deals with other Southeast Asian markets, another trader said.

    The Thai government on Thursday announced that it would sell 44,000 tonnes of rice for human consumption from its state stockpiles in April and May.

This sale could drive prices higher next month, traders said.

Reporting by Rajendra Jadhav in Mumbai, Panu Wongcha-um in Bangkok, Ruma Paul in Dhaka and Khanh Vu in Hanoi; Editing by Amrutha Gayathri

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