Rice prices in Vietnam edged up slightly this week as exporters prepared to ship some of the grain before harvest peaks later this month, while foreign buyers eyed a tender in Thailand for cheaper deals, traders said on Wednesday.
Thailand, the world's second-biggest rice exporter after India, will open a tender to sell 1.4 million tonnes of rice on July 6, the Commerce Ministry has said. The country has announced plans to sell 2 million tonnes of rice over the next two months from stockpiles.
"People are looking at the tender and if prices there are low, it could pull down new-crop rice toward $350 a tonne, which will make it more competitive against Vietnamese rice," a Vietnamese trader at a foreign firm in Ho Chi Minh City said. Thailand's 5-percent broken new-crop grain stood unchanged in the past week at $370 a tonne, free on board (FOB) basis. However, Thai old-crop grain was priced at $340 a tonne this week, lower than $350-$355 a tonne for similar variety Vietnamese rice, traders said.
"I expect prices to further ease in the short run," said Kiattisak Kanlayasirivat from Ascend Commodities in Bangkok. "Demand from African countries is still the same but they buy our old rice," he said. "Nobody is buying our new grains." Some rice traders were on holiday on Wednesday as Thai banks and stock markets were closed for a mid-year break.
In Vietnam, exporters were preparing to ship rice to the Philippines and Africa, a move that has boosted prices slightly, a trader at a foreign firm in Ho Chi Minh City said. "But the market is slow as most buyers are waiting for new grain," he said.
Prices are expected to weaken when harvesting of Vietnam's summer-autumn crop peaks later this month, traders said. Demand for imports from key buyer China is forecast to rise 17.5 percent to 4.7 million tonnes in the marketing year 2015/16 starting in July due to high domestic prices, a US Department of Agriculture report said. Thailand toppled Vietnam to regain its position as the top rice exporter to China in the 2014/15 season ended last month, the report added.
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