Rice prices in Vietnam fell this week to their lowest in nearly a year as buyers were absent, while fresh supply expected in Thailand in October could weigh on currently steady prices, traders said on Wednesday. The indicative prices of Vietnam's 5 percent broken rice eased to $335-$345 a tonne, free-on-board (FOB) basis, and the 25 percent broken grade, often sought by the Philippines, weakened to $325 a tonne, both near one-year low, based on Reuters data.
Thailand and Vietnam are the world's second and third-largest rice exporters after India. "Vietnam's rice sales to the Philippines won't be quick even though private traders have plans for rice import," a trader at a European firm in Ho Chi Minh City said.
Other traders said overall demand for Vietnamese rice was thin, despite news of possible interest by Philippine private firms. The Philippines' state grains agency has said it would accept applications from private traders to import up to 805,200 tonnes of rice, most of which from Thailand and Vietnam, by February 28, 2017.
In Thailand, the benchmark 5-percent broken rice narrowed to $370 a tonne, from $370-$376 a week ago, as demand for Thai rice was low and fresh grain has started boosting supply, traders said. "A huge amount of new rice is expected next month. That should make prices drop," a trader in Bangkok said. Asia's rice production will recover in the 2016/2017 season, after extended dry weather trimmed output in almost all key Asian suppliers this year, BMI Research said in a report on Tuesday. "Prices will ease in the coming months and return to the levels seen around the beginning of the year," the report said.
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