Rice prices were stable in India and Vietnam on weak demand while in Thailand they widened on talk of trades being done, traders said on Thursday. India's 5 percent broken parboiled rice prices were steady at $373-$378 per tonne as exporter demand remained slack.
"Demand is still weak, but we could not lower export prices due to higher paddy prices and strong rupee," said an exporter based in Kakinada in the southern state of Andhra Pradesh. Along with exporters, government agencies are actively buying paddy for the public distribution system, pushing up prices above the minimum purchase price, exporters said.
A strong rupee trims the returns of exporters. The country's rice production in 2016/17 is likely to rise by 4.3 percent to a record high 108.86 million tonnes, the farm ministry said on Wednesday. India, the world's biggest rice exporter, mainly exports non-basmati rice to Africa and premier basmati rice to the Middle East.
In Vietnam, the world's third largest rice exporter, 5 percent broken rice prices were stable at $350-$355 a tonne while local prices remained at a high level, traders said. "Local prices may drop in the next few weeks when the main harvest season fully starts," said a Ho Chi Minh City-based trader. Meanwhile, Thai benchmark 5-percent broken rice widened to $350-$360 a tonne, free-on-board (FOB) Bangkok, from $350-$355 a tonne last week.
A trader in Bangkok said prices strengthened because of talk of trades, although his company itself has not seen much demand. "Millers said there's trade going on," he said. "It's high time, as trade has paused for two weeks." Another trader in Bangkok said buyers are holding back from purchases because the government has not released results of the February state auction, in which it aimed to offload 2.8 million of the remaining 8 million tonnes. "The government hasn't announced auction results, so buyers are waiting," he said.
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