BENGALURU- A weaker baht pushed rice export prices in Thailand lower this week, although there were expectations of new deals with the Philippines and China, while rates in India languished at the 21-month lows hit last week due to sluggish demand.
In Thailand, benchmark 5 percent broken rice prices were quoted at $380-$400 per tonne, free on board (FOB) Bangkok, dropping from $400-$402 last week.
The weakening of the baht against the U.S. dollar was the main factor behind the drop in prices this week, Bangkok-based traders said, adding that overseas demand for Thai rice remained flat and the market also expected additional supply from the new crop.
“The end of rainy season means rice from the new harvest will enter the market and this has led to a slight price drop but it is seasonal,” a Bangkok-based rice trader said.
However, Thai rice exporters are expecting a deal with the Philippines before the end of the year and a possible government-to-government rice sale to China, another Bangkok-based trader said.
The Rice Exporters Association of Thailand this week said it expects Thailand to meet the 11 million tonne rice export target before the end of the year.
In top exporter India, the 5 percent broken parboiled variety was quoted around $361-$367 per tonne this week, unchanged from last week, when it hit the lowest since January 2017. [RIC/AS]
Supplies from the new crop will rise in coming weeks, but demand could also improve as Indian shipments are cheaper than other origins, said one exporter based at Kakinada in the southern state of Andhra Pradesh.
Government buying of local paddy rice could limit the downside to export prices, the exporter said.
The government has raised the prices paid to local farmers for common grade paddy rice by 13 percent from a year ago to 1,750 rupees per 100 kg for the new season crop.
Neighbouring Bangladesh, which became a major importer in 2017 due to depleted stocks and record local prices after regional flooding, will procure more rice locally after output revived.
“We are getting a good response in our local procurement drive and will continue it,” a food ministry official said.
The government has already procured around 1.4 million tonnes of rice locally.
In Vietnam, rates for 5 percent broken rice were unchanged from a week earlier at $410-$415 a tonne.
“Exporters haven’t clinched any new deals recently as domestic supplies are so low now, despite prices remaining attractive,” a Ho Chi Minh City-based trader said.
Traders said domestic stockpiles now total around 300,000 metric tonnes.
Vietnam’s rice exports in January-October were forecast to rise 3.4 percent from a year ago to 5.24 million tonnes, government data showed.