Vietnamese exporters lowered rice offer prices this week on thin buying demand, but were still unable to compete with Pakistani grain rates, while Thai prices were stable on tight supply, traders said on Wednesday. Farmers in Vietnam's Mekong Delta have been waiting for the rainy season to start planting their next summer-autumn crop. However, the dry weather might continue until late May, state forecasters said.
Vietnam's 5-percent broken rice stood at $370-$375 a tonne, free-on-board (FOB) basis, against a wider range of $365-$385 last Wednesday. "Prices stand still as no new sales have emerged," a trader at a foreign firm in Ho Chi Minh City said. "A few companies have gone to Pakistan for rice at cheaper rates."
Pakistani 5 percent broken rice was quoted at $345 a tonne, FOB basis, which has attracted buyers, he said. The Philippines, which stated it can import 500,000 tonnes to boost state reserve stocks, has not made any moves until now ahead of an election next month, traders said. This year's dry weather has damaged at least 1 million tonnes of paddy in Vietnam, and another 400,000 tonnes could be affected from the Mekong Delta's next summer-autumn crop, Agriculture Minister Cao Duc Phat told a ministry meeting on Tuesday.
The total losses would equal to 700,000 tonnes of milled rice, or 8 percent of Vietnam's export volume in 2016 projected to be 8.7 million tonnes, based on a UN Food and Agriculture Organization forecast. In Thailand, despite a depreciation of the Thai baht over the week, tight supply kept rice prices stable, a trader in Bangkok said.
Thai 5-percent broken rice narrowed to $385-$390 a tonne, FOB Bangkok, from $382-$390 last week. "Domestic prices go up because of low supply, so the weaker exchange rate balanced that out," said a Bangkok-based trader. Thailand and Vietnam, the world's second- and third-biggest rice exporter after India, contribute a combined 40 percent of global rice trade.