Rice prices from the world's top two exporters, Thailand and Vietnam, were steady at relatively high levels amid thin demand as buyers switched to cheaper rice from India, traders said on Wednesday. The price of benchmark 100 percent B grade Thai white rice was offered at $610 per tonne, unchanged from last week, traders said.
"Prices were supported by the government intervention scheme, not by demand," said Kiattisak Kanlayasirivat of Novel Agritrade in Thailand. The government started buying rice from farmers in October at higher-than-market-prices of 15,000 baht a tonne, a level that traders said could push Thai export rice prices to above $800 a tonne.
Vietnam's 5 percent broken rice stood at $575 to $585 a tonne, free-on-board (FOB) Saigon Port, from $575-$590 a week ago. The $590 per tonne level was the highest for more than three years. "There is no-one buying or selling on the market as the stock is very thin now," a trader at a foreign company in Ho Chi Minh City said. Trader said Indian prices are around $100 a tonne below those in Vietnam.
CHEAP INDIAN GRAIN EYED Several representatives from Indian rice firms as well as Pakistan are joining a rice conference in Ho Chi Minh City this week mainly to seek buyers of their grain, traders said, noting that production in Pakistan was also good.
The Indian government has allowed export of 2 million tonnes of non-basmati rice in September and traders said the grain was offered at $460-$470 a tonne. Traders estimated at least 1 million tonnes of the grain to have been contracted for export since India freed overseas sales last month.
About 700,000 tonnes would be shipped by December from various ports on the east coast to destinations like Bangladesh, Nigeria and South Africa. Traders said they expected the Indian government could allow the export of as much as 4 million tonnes of rice due to bumper stocks. The value of the Indian currency has fallen 10.8 percent to 49.16 rupees against the US dollar from its high this year in late August.
India, the world's second biggest rice producer, is sitting on a huge inventory and heading for a bumper harvest for the second year in a row due to normal monsoon rains. On September 1 India's rice stocks at government warehouses stood at 22.7 million tonnes against a target of 9.8 million tonnes.