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Strong rice demand from Asia, Africa lift Indian prices

Economy May 05, 2022 10:27PM ET
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© Reuters. Labourers move a cart loaded with rice bags inside a food processing unit, which was reopened after weeks-long shutdown to slow the spread of coronavirus disease (COVID-19), on the outskirts of Ahmedabad, India, April 20, 2020. REUTERS/Amit Dave/Files

By Roshan Abraham

(Reuters) - Export prices of rice from India rose this week on increasing demand from Asia and Africa, while dwindling supplies of the staple lifted Vietnamese rates.

Top exporter India's 5% broken parboiled variety was quoted at $363-$367 per tonne, up from last week's $361-$365, with prices also being supported by an appreciation in the rupee.

"Demand for all types of rice is robust from Asia and Africa," said Nitin Gupta, vice president for Olam India's rice business.

Generally, a stronger rupee reduces traders' margin from overseas sales.

In neighbouring Bangladesh, domestic prices remained high, which officials blamed on hoarding and warned of strict action against those amassing the staple for windfall profits.

Meanwhile, Vietnam's 5% broken rice was offered at $420 per tonne on Thursday, up from $415 a week ago.

"Prices are edging up on tight supplies as the winter-spring harvest has come to an end," a trader based in Ho Chi Minh City said, adding that supplies would increase after the summer-autumn harvest in late-May.

Vietnam's rice exports in the first four months of the year likely rose 4.4% from a year earlier to 2.05 million tonnes, while revenue from rice exports in the period fell 6% from a year earlier.

Thailand's 5% broken rice prices were quoted at $435-$445 per tonne on Thursday, an increase from $432-$435 last week.

"There has been more demand from Iraq, with many freighters sent to buy rice and this drove up prices," a Bangkok-based trader said.

Ships made available by Middle Eastern clients have eased the burden of high freight costs that were a concern for exporters earlier, according to traders.

The amount of rice in the market will begin to decrease as Thailand move towards the rainy season, another trader said.

Strong rice demand from Asia, Africa lift Indian prices
 

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