Vietnamese rice prices soar to near 4-year high

Vietnamese rice prices soar to near 4-year high

Thai prices up, demand low

A farmer works on a rice paddy field in Quang Ngai province, Vietnam, on March 14, 2018. (Reuters photo)
A farmer works on a rice paddy field in Quang Ngai province, Vietnam, on March 14, 2018. (Reuters photo)

BENGALURU, India: Export prices for rice surged to a near four-year high in Vietnam this week due to strong demand, while slow buying interest put pressure on prices of Indian rice.

The threat of floods also raised the prospect of Bangladesh stepping up purchases.

Vietnam's 5% broken rice prices rose to US$455-$460 a tonne, their highest since August 2014, versus $445-$450 last week.

"Prices continue to rise on stronger demand and tight supplies," a Ho Chi Minh City-based trader said.

"The Philippines is expected to purchase another 250,000 tonnes in an open tender on May 22, after accepting 250,000-tonne offers from Vietnam and Thailand last week."

Vietnam exported 721,379 metric tonnes of rice in April, up 9.5% from March, according to the government's official customs data.

For the first four months of 2018, Vietnam's exports totalled 2.2 million tonnes, an increase of 24.3% from a year earlier, the General Department of Customs said. 

Rice export revenue in the January-April period rose 40.3% to $1.1 billion.

In Thailand, prices of 5% broken rice rose slightly to $435-$445 a tonne, free on board (FOB) Bangkok, from $430-$445 last week, with traders attributing this to a deal with Philippines struck last week to supply 120,000 tonnes.

Demand is still slow as the country expects ample supply from the harvest around the end of May or early June, traders said.

Last week Thailand increased its rice export goal this year to 10 million tonnes, up from 9.5 million tonnes previously.

The Thai Commerce Ministry last week said the country had exported 3.31 million tonnes of rice from the beginning of the year until mid-April, more than India and top competitor Vietnam.

Prices for top exporter India's 5% broken parboiled variety fell by $5 to $407-$411 per tonne.

"Rupee depreciation is helping exporters to reduce prices.

Demand is also weak from Bangladesh and Africa," said an exporter based at Kakinada in the southern state of Andhra Pradesh.

The rupee has fallen more than 5% so far in 2018, increasing exporters' margins from overseas sales.

Meanwhile, the country's neighbour, Bangladesh, which emerged as a major buyer in 2017 after flood damage to crops, may require hefty imports as floods could hit the country again this year and pose a threat to crops, weather department officials said.

Pre-monsoon rains, coupled with thunderstorms, are also hampering the harvesting of summer rice crops, according to officials from the Department of Agriculture Extension.

Imports into Bangladesh were initially expected to slow due to a good summer crop.

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