The Asian rice export market was quiet this week, with prices in Thailand and India dropping on low demand, while Vietnam rice prices were unchanged, traders said. The prices of Thai 5-percent broken rice edged down to $410-$432 a tonne, FOB basis, this week from $415-$432 a tonne last Wednesday, due to a lack of demand from buyers.
"Prices dropped a little because the market is very quiet," a Bangkok-based trader said. "This really has nothing to do with the auctions," he added. The Thai government conducted two auctions last week to sell 3.81 million tonnes from state stockpiles.
The government however approved the sale of only 45,459 tonnes for the first auction on Monday, accounting for 2.79 percent of the opening quantity of 1.6 million tonnes. The government said it could not sell more as most of the bids were low.
"Auction results will not affect prices because the amount sold is too low and the rice is old," another trader in Bangkok said. The sale of the second export-only auction will be approved later on Wednesday. The Thai Rice Exporters Association said on Wednesday it expected the country to export 9.5 million tonnes of rice in 2016, up from an earlier forecast of 9 million tonnes and matching a government forecast.
The world's second-biggest rice exporter after India exported 4.99 million tonnes of rice in Q1 and Q2, the association said, adding that market demand in Q4 should boost Thai rice exports for the year. Thailand has some 9 million tonnes of rice stored in warehouses across the country. Prices of India's 5 percent broken parboiled rice fell by $2 per tonne this week to $381-$391 per tonne on subdued demand. "Prices have moderated a bit due to weak demand from African countries," said an exporter based in Kakinada in the southern state of Andhra Pradesh. As on July 29, Indian farmers have cultivated rice on 23.19 million hectares, slightly higher than the 22.57 million hectares during the same period a year ago. "Almost all key rice producing states have received ample rainfall. Crop is in a very good shape. This year we can harvest more than last year," the exporter said.
India mainly exports non-basmati rice to African countries and premier basmati rice to the Middle East. India is planning to buy 33 million tonnes of summer-sown rice from farmers in the 2016/17 season for its food welfare programmes and to meet emergency needs.
In Vietnam, the world's third-largest rice exporter after India and Thailand, prices of the 5 percent broken rice from the summer-autumn crop stayed flat at $360-$365 a tonne, FOB basis, on Wednesday, traders said. "There were no sales this week," said a Vietnamese trader in Ho Chi Minh City. "People are all waiting for the final results of Thai auctions," he added. India, Thailand and Vietnam together account for around 60 percent of global rice trade.