Thai export rates hit 2-month high on supply risks

Thai rice export prices rose to their highest in nearly two months this week on concerns over supply even as demand remained sluggish, while a strong rupee kept rates for the Indian variety near an eight-month trough.

Thailand's benchmark 5% broken rice prices rose to $475-$485 on Thursday from $470-$480 last week, traders said.

"New supply hasn't yet arrived, resulting in higher prices," a Bangkok-based trader said.

Prices for top exporter India's 5 percent broken parboiled variety were unchanged at $366-$370 per tonne, its lowest since the week of March 26.

"Demand is weak as buyers have taken a pause. Since container freight rates are going up, exporters can't reduce the prices," said an exporter based at Kakinada in the southern state of Andhra Pradesh.

An appreciation in the rupee is also reducing traders' margins from overseas sales, which makes securing exports deals difficult, the exporter added.

Meanwhile, Bangladesh's state grains agency issued an international tender to purchase 50,000 tonnes of rice this week, its first tender in three years amid dwindling supplies and a surge in prices of the staple grain.

But market participants said the move would hardly have any impact on prices, which have gone up around 50% since March, as the COVID-19 pandemic pushed local prices to record highs due to panic buying.

Vietnam's 5% broken rice prices were unchanged from a week earlier at $495-$500 per tonne on Thursday.

"Demand from the Philippines is on the rise, but rice shipments from Cambodia to Vietnam help offset domestic thin supplies," said a trader based in Ho Chi Minh City.

Vietnamese export rates are likely to remain around current levels until the end of the year, traders said.

Government data showed Vietnam's rice exports in October fell 5.8% from September to 362,930 tonnes.