Thai rice prices held steady on Thursday, but they are likely to climb in the next few days on strong overseas demand, traders said.
Thai five percent broken grade was quoted steady on Thursday at $212/tonne FOB,
"Buyers from Latin American countries have been in the market. They are seeking to buy more Thai 100 percent rice grade B for prompt shipment," one trader said.
"Columbian buyers have just bought 40,000 tonnes of Thai 100 percent rice grade B at $218/tonne FOB for prompt shipment," said another.
Columbian buyers started buying Thai rice this year. Buyers from Brazil and Chile have been in the Southeast Asian market for more than a year now as the price of rice from the United States, the traditional supplier, has been higher, traders said.
US rice was being offered on Thursday at around $350/tonne FOB, up from $300 quoted late last year, and only $200 in early 2003.
Thai 100 percent grade B was being offered at $220/tonne FOB. It costs almost $60 to ship one tonne of rice to Latin America from Thailand.
The domestic price for Thai 100 percent grade B was quoted steady at 7,800 baht/tonne ($199/tonne).
Between January 1 and 22, Thailand exported 508,802 tonnes of rice, down from 512,826 tonnes in the same period last year.
Thailand, the world's top rice exporter, shipped a record 7.58 million tonnes in 2003, up from seven million in 2002.
The domestic Thai price has been steady this week amid tight supply at the end of the harvest season for the 2003/04 (November-October) main rice crop, traders said.
"Also, farmers have been actively selling rice to the government," said one miller.
Bangkok buys rice from farmers every year and stocks it to support domestic prices. Thailand produces two rice crops a year.
So far, the government has bought 1.18 million tonnes of paddy rice from farmers under the scheme, Commerce Ministry officials said.
The Agriculture Ministry estimates the 2003/04 second rice crop at around 5.9 million tonnes, down from 6.4 million in the previous crop year on expectations of drought in some growing areas.