India Rice Rates Hit Four-month High; Traders Wary As Coronavirus Spreads
India's 5 per cent broken parboiled variety was quoted around $370-$375 per tonne this week, the highest since the last week of September.
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Rice export prices in India edged up to the highest level in more than four months this week, helped by healthy demand from African countries, while markets in Thailand and Vietnam grapple with the new coronavirus outbreak.
India's 5 percent broken parboiled variety was quoted around $370-$375 per tonne this week, the highest since the last week of September.
Export prices were up from $369-$373 quoted in the previous week, also supported by an appreciation in rupee.
"Demand is good for the new season crop. Prices are also competitive," said an exporter based at Kakinada in Andhra Pradesh.
The uptick in demand came after rice exports in 2019 fell 18.1% from a year ago to their lowest in eight years, government data showed.
Thailand's benchmark 5 percent broken rice prices eased to $425-$439 a tonne from $432-$453 last week, hurt by a weak local currency.
The Thai baht plunged to a seven-month low on Jan. 30, weighed down by the spread of the coronavirus that threatened the country's tourism sector, a key driver of growth.
Traders expect export prices to drop further on the outbreak that has killed 563 people in mainland China.
China was Thailand's second-largest export market last year. Chinese tourists also account for more than a quarter of total tourist arrivals in the Southeast Asian country each year.
Domestic rice prices in Thailand remained high as a persistent drought undermined new supply, according to a Bangkok-based trader.
"The ongoing coronavirus epidemic in China has also caused disruption to deliveries of Vietnamese farm produce to China, including rice," a trader based in Ho Chi Minh City said.
The impact on shipments was however limited since China had been cutting down on rice imports from Vietnam for over a year, the trader said.
Rates for 5% broken rice in Vietnam rose to $355-$360 per tonne from $345 a tonne a week ago.
"Demand for 5% broken rice remains strong but the growing area in Vietnam is shrinking, partly due to salinity," the trader said.
Farmers in the Mekong Delta have harvested around 30% of the winter-spring crop, traders said.
Meanwhile, Bangladesh has offered traders a cash subsidy worth 15% of rice exports in a bid to compete with rivals and protect farmers struggling with low prices, Agriculture Minister Abdur Razzak said on Wednesday.
"We wanted at least a 20% cash subsidy. It'll still be difficult to fight our competitors," a trader told Reuters.