Asia rice: Indian rice export prices fall; Bangladesh proposes cutting rice tax

Indian rice export price dipped this week on sluggish demand and depreciation in the rupee, while Bangladesh has proposed cutting the withholding tax on rice.

India’s 5% broken parboiled variety was quoted at $335-$340 per ton this week, down from last week’s $337-$345. Indian 5% broken white rice was priced at $340-$346 per ton.

“Despite rising concerns over rainfall and production, prices have not increased as stock levels from last year’s crop remain high,” said a New Delhi-based dealer.

Meanwhile, Bangladesh on Thursday proposed cutting the withholding tax on rice to 0.5% from up to 5% in its budget for the fiscal year starting in July, aiming to help reduce food prices and ease inflationary pressure on consumers.

Thailand’s 5% broken rice was quoted at $450–$475 per metric ton, up from last week’s $450, traders in Bangkok said.

“There are reports that the Philippines will be buying more,” a trader said, adding that African buyers were switching to cheaper Indian rice. The trader also noted that supply was expected to decline as farmers reduce production due to higher costs.

Another trader said that prices rose on increased domestic prices because of higher costs, but demand was flat. They added that the Philippines has switched to Vietnamese rice due to lower prices, and supply is currently held by rice millers, while the outlook remains uncertain due to El Nino.

The El Nino weather phenomenon is a warming of ocean surface temperatures in the eastern and central Pacific.

Vietnam’s 5% broken rice was offered at $415-$420 per metric ton on Thursday, unchanged from a week ago.

“Trading activity is quiet as both buyers and exporters are assessing the impact of the fresh attacks in the Middle East on shipping and logistics cost,” a trader based in Ho Chi Minh City said.

Traders said domestic supplies are expected to rise over the next few weeks with the arrival of output from the summer–autumn harvest, but concerns over the potential impact of El Nino are likely to keep prices from falling.