Fresh demand from Nigeria helped keep Thai rice at relatively high levels this week while Vietnamese prices started to ease as well-stocked buyers stayed on the sidelines, traders said on Wednesday. The benchmark 100 percent B grade Thai white rice was steady at $615 per tonne. That was above the $550 per tonne being offered early this year, but still far below the record $1,080 a tonne reached in April 2008.
"There was a combined of 100,000 tonnes of Thai parboiled rice, waiting to be loaded for Nigeria's orders," said a Bangkok-based trader. Demand for parboiled rice, which is made of the same grade paddy as white rice, helped support Thai prices in general, although overall demand remained thin.
Thailand, the world's biggest rice exporter, was expected to ship a record 10 million tonnes this year. However, its annual exports could fall sharply next year if the government implements its aggressive intervention scheme, which could push prices to uncompetitive high levels. Traders said prices were expected to be pegged at firm levels for weeks, supported by political speculation that the Thai government would intervene on rice prices aggressively.
The Puea Thai-led government, which took power officially earlier this month, promised to buy rice from farmers at 15,000 baht per tonne, double the current market prices of around 8,000 per tonne. That encouraged local traders to hoard rice with the intention of reselling to the government when the intervention plan is implemented in November, causing tight domestic supply and pushing prices higher.
Apart from Nigeria's purchase, there was additional demand from Indonesia, which was believed to have bought 300,000 tonnes of 15 percent broken grade white rice from both Thailand and Vietnam. However, senior government officials from those countries tried to play down the deals in a bid to avoid pushing up prices around the region.
In Vietnam, the world's second-biggest exporter, rice prices eased due to the absence of fresh demand, traders said. "Prices fell in recent days but have now slowed as there is still a huge loading demand," an exporter based in the Mekong Delta said, adding that most areas under the summer-autumn rice crop has been harvested.
The 5 percent broken rice eased to $560-$565 a tonne, free-on-board, from $570-$580 last week. The 25-percent broken rice dropped to $525-$530 a tonne, from $530-$540 a week ago. Vietnam has been shipping rice under a deal totalling 500,000 tonnes for Indonesia. Loading under a second deal of 300,000 tonnes would start in October.
Rice exports between January and September would hit 6 million tonnes, up 13.2 percent from a year ago, state media quoted an industry official as saying early this month. Vietnam's rice exports between January and August rose 6.5 percent from the same period last year to an estimated 5.31 million tonnes, government data showed.