Vietnamese rice exporters lowered their quotations on Wednesday to attract buyers, but failed to compete with Thailand where rice prices have been hovering at their 13-month lows due in part to a weaker currency, traders said. Thai benchmark 5-percent broken rice prices dropped to $342-$345 a tonne on Wednesday, free-on-board (FOB) basis, from $345-$348 a tonne last week when they hit their lowest in 13 months.
A trader in Bangkok said prices dropped this week because of the depreciation of Thai baht against US dollars. "Prices are actually the same in Thai baht, but the depreciation made them look lower in dollars," he said. Thai baht has weakened 0.6 percent in the past week to 35.14 per dollar on Wednesday.
Another trader said he expected Thai rice prices to rise in the near future as a result of government intervention and thinning stocks after the harvest goes beyond its November peak. "There is a tendency for stronger prices after government intervention. And now market movement has begun to slow down with less paddy stock," he said. "Domestic prices are beginning to strengthen."
Vietnam's 5-percent broken rice widened to $347-$350 a tonne on Wednesday, FOB basis, against $350 a tonne a week ago. "Vietnamese prices are still high, while Thai rice prices are lower. So it is difficult to sell now," a Vietnamese exporter in Ho Chi Minh City said.
Thailand and Vietnam are the world's second- and third-biggest rice exporters after India. Another trader said African buyers have switched their purchase to Thailand and Pakistan, which both were offering cheaper prices. Given the slow market, Vietnam's rice exports this year may not rise beyond 5 million tonnes, traders said, down significantly from 6.58 million tonnes shipped in 2015. Vietnam's rice exports in January-October fell 21 percent from a year ago to an estimated an estimated 4.22 million tonnes, based on government data.
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