Rice prices climb on improved overseas demand, fresh crop supply caps gains
Rice prices in India climbed this week, buoyed by improved overseas demand, but rising supplies from a new season crop capped gains for the staple grain in the world’s top exporter.
India’s 5 per cent broken parboiled rice prices rose by $ 2 per tonne to $ 399 to $ 402 per tonne.
“There was an improvement in demand from Bangladesh and Sri Lanka. African buyers were also making inquires,” said an exporter based in Kakinada in the southern state of Andhra Pradesh.
In Thailand, benchmark 5-per cent broken rice was quoted at $ 380-$ 387 a tonne, free-on-board (FOB) Bangkok, compared with $ 375-$ 387 last week.
Thai Hom Mali rice won the title of “World’s Best Rice” at this year’s World Rice Conference held in Macau last week and traders said this will have a positive impact on global demand for Thai rice.
“Due to floods in the northeast (part of Thailand) this year, where Hom Mali rice is grown, the output of the crop has dropped, causing prices to rise. With this new development, I expect prices to rise further,” said a Bangkok-based trader.
Traders were also optimistic that South Korea’s tender to buy 132,790 tonnes of rice for December-March arrival may result in demand for Thai rice.
Overall, however, traders said demand was slow, and with new crops expected to enter the market starting the end of this month, prices could drop.
Meanwhile, Bangladesh cancelled its first-ever deal with Cambodia to import 250,000 tonnes of white rice over a delay in shipments, officials said on Tuesday. The deal was signed in August at $ 453 a tonne.
The country has emerged as a major importer of the grain this year after floods damaged its crops and, despite deals with several rice exporting countries including Myanmar and Bangladesh, is still battling to build its reserves.
In Vietnam, the benchmark 5 per cent broken rice was quoted at $ 400-405 a tonne, free-on-board (FOB) Saigon, little changed from the high levels last week due to continuous shortage of supply, traders said.
“The recent harvest mainly served domestic demand and didn’t affect export price. New crop yield was available, but prices stayed high,” a trader in Ho Chi Minh City said.
“We won’t have a larger supply until the end of the winter-spring crop season in March.”
Sowing for the winter-spring crops, one of Vietnam’s two major rice crop seasons, is expected to start only by late November or December as flood waters in the rice-growing Mekong Delta have not completely receded, the trader added.