Vietnamese rice prices rose this week on the back of strong loading demand, while Thai export prices were pushed up by strength in the baht despite a lack of orders, traders said on Wednesday. Asian prices were likely to stay firm because of the prospect of demand from Indonesia, they said.
Indonesian Agriculture Minister Suswono has said Jakarta may import rice this year or the next to build up its stocks as flooding could damage crops. Representatives of Bulog, an Indonesian state procurement body, visited Thailand and Vietnam this month.
Traders said Indonesia, ambitious to become self-sufficient in rice, just wanted to check if the top two exporters could supply it with around 300,000 tonnes of rice, if needed. There has been no confirmation from the various capitals. "Some members of Vinafood 2 have been asked to start buying 15 percent broken rice for stockpiling, which could be used for sales to Indonesia," a trader in Ho Chi Minh City said.
Vinafood 2, the country's top rice exporter, has been appointed the sole rice seller for the Indonesian market. This speculation, plus strong loading demand from Cuba, has helped keep prices in Vietnam at a relatively high level. "After the news on the rice sales to Cuba, prices started going up," a trader in Ho Chi Minh City said.
Vinafood 1, Vietnam's second-largest rice exporter, has secured a contract to export 250,000 tonnes of rice to Cuba for loading until March 2011. The 5 percent broken rice rose to $475 a tonne, free on board from last week's $450 to $475, while the 25 percent broken rice rose to $435 a tonne from $420 to $435. Quotations this week are level with the latest Vietnam Food Association floor prices set on September 15. In Thailand, the benchmark 100 percent B grade Thai white rice rose to $495 per tonne from $490 last week, exporters said.