Bangladesh to sign rice deal with Vietnam

Bangladesh will sign a deal next week to import 200,000 tonnes of rice from Vietnam in a government deal, on the heels of another agreement concluded with Thailand, as the South Asian country seeks to ensure supplies of the staple, a senior official said on Friday.
The price for 100,000 tonnes parboiled rice from Vietnam is $575/T including CIF and for 100,000 tonnes white rice $530 a tonne CIF, Ahmed Hossain Khan, director-general of the state grains buyer, told Reuters. Although the world's fourth-biggest rice producer at 33 million tonnes, Bangladesh has emerged as a major importer this year and is desperately looking for dependable sources.
Bangladesh has signed a deal to import 200,000 tonnes of rice from Thailand in their first government-to-government deal as it has moved to speed up grain imports and stabilise domestic prices. Although neighbouring India, once its traditional supplier, has recently lifted a ban on some premium variety rice, it will not benefit Bangladesh which buys mostly lower quality rice, traders said.
The government imported more than 1 million tonnes of rice and wheat during July-February period, and signed deal for around 1.1 million tonnes including the latest deal with Thailand, another food official said. Apart from that, talks are continuing to import 300,000 tonnes from India under a state-to-state deal.
In the last fiscal year that ended in June 2010, the government imported around 500,000 tonnes of rice and wheat. Despite good crops, rice prices in Bangladesh have risen by more than 33 percent over the past year which analyst blamed mainly on stockpiling and hoarding by middlemen.
Food inflation hit 11.9 percent in January, its highest since September 2008, which is a major concern for the government in a country where 40 percent of its more than 150 million people survives on less than $1 a day. Analysts say the opposition political parties trying to force a mid-term election, not otherwise due before end of 2013, are likely to use the food issue to boost their anti-government campaign.
Prime Minister Sheikh Hasina, however, told parliament on Thursday her government was aware of the food situation and would ensure no one is deprived of two square meals a day. With growing public discontent over prices, the government has increased its discount grain distribution target to 3 million tonnes for the year to June from 2.7 million tonnes, adding pressure to the budget.