Asia Rice-Prices up in Thailand on thin supply, India on firm rupee

20.04.2017

Rice prices in Thailand rose on thin supply and Indian rates climbed on stronger rupee, while trade in Vietnam remained sluggish, traders said on Thursday.

Thai benchmark 5-percent broken rice rose this week to $360-$375 a tonne, free-on-board (FOB) Bangkok, from $350-$365 a tonne last week.

"There is less supply of new rice as we are expecting off-season crops to arrive," a trader in Bangkok said.

The hike in prices occurred as the Thai government encouraged rice millers to buy the grain in a bid to prevent an oversupply when new crops are harvested, another Bangkok-based trader said.

Thailand has exported over 3.48 million tonnes of rice so far this year until April 18, up 6.4 percent from the year-ago period, the commerce ministry said on Thursday.

The amount it received through exports was more than 51 billion baht ($1.49 billion), the ministry added.

The ministry announced on Wednesday that Thailand has sold 1.62 million tonnes of rice from state stockpiles for industrial use from a March auction at $231 million.

It also plans to sell 1.03 million more tonnes of spoiled and sub-standard rice in a state auction on April 28.

Ever since the military took over power in a 2014 coup, the government offloaded over 12 million tonnes of rice, which were accumulated under a previous civilian government's rice subsidy scheme.

At present, this leaves behind about 5 million tonnes in state stockpiles, with 1.72 million tonnes fit for human consumption. The government said it may clear the stocks by 2017.

In India, 5-percent broken parboiled rice rose by $2 to $384-$389 a tonne this week, as paddy prices and rupee gained strength.

"Local paddy prices are firm. Rupee is also strengthening. This is making Indian rice expensive for overseas buyers," said an exporter based at Kakinada in the southern state of Andhra Pradesh.

So far, the rupee has risen 5.2 percent this year, and is trading near its highest level in 20 months. A strong rupee trims returns of exporters.

"African buyers are shifting to Vietnam and Thailand due to higher prices in India. We are losing market share," said another exporter based at Kakinada.

India, the world's biggest rice exporter, mainly exports non-basmati rice to African countries and premier basmati rice to the Middle East.

In Vietnam, the market maintained a quiet momentum amid low competitive prices, which fall between prices of new and old Thai grain.

Prices of the 5-percent broken rice remained stable at $350-$355 a tonne, FOB Saigon.

"Customers who focus more on prices will choose old Thai rice as it is cheaper, while buyers who look for quality will choose new Thai rice as it is just a bit higher than Vietnamese rice but of better quality," said a Ho Chi Minh-based trader.

Traders expect Vietnam's rice export to be lower this month compared with the same period a year earlier.

Thailand and Vietnam are the world's second- and third-biggest rice exporters.


indiatimes

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