BENGALURU, India: Bangladesh scrapped a plan to import Thai rice, citing delays in finalising a deal, as rice prices in India and Thailand fell this week, pressured by sluggish overseas demand.
Bangladesh, which has emerged as a major importer of rice since 2017 after floods damaged its crops, scrapped a plan to import 150,000 tonnes of rice from Thailand, agreed at $465 a tonne in October.
"We had to cancel it as they were taking too long to finalise the deal. We're getting supplies from neighbouring India ... At the same time, we are getting good response in our local procurement drive," Badrul Hasan, head of the state grains buyer, told Reuters.
In India, prices for 5% broken parboiled rice fell by $12 to $420-$424 a tonne, having touched their highest since September 2011 a couple of weeks earlier.
"Demand is weak. Buyers are postponing purchases, expecting a further drop in prices," said an exporter based in Kakinada in the southern state of Andhra Pradesh.
A statement released by a government body last week said that India's April-December non-basmati rice exports had jumped by 39.5% from a year ago to 6.34 million tonnes as Bangladesh and Benin increased purchases.
Meanwhile, Thailand's benchmark 5% broken rice rates fell to $400-$419 a tonne, free on board (FOB) Bangkok, compared with $420-$430 last week.
"Many exporters are waiting on big markets like Indonesia, Philippines, Iran and China, but so far there are no fresh bids," one Bangkok-based rice trader said.
"Prices did not fluctuate much this week because many rice mills are closed due to the Chinese New Year," he added.
The Lunar New Year is not an official public holiday in Thailand, but many businesses close for the occasion.
The exchange rate, with a firmer baht, is another important factor behind the slump in demand, another trader said.
In Vietnam, the world's third-largest rice exporter, financial markets are closed for the Feb 14-20 Lunar New Year holiday.