BENGALURU: Rice prices in India fell sharply this week from multi-year peaks hit last week due to a depreciating rupee and slowing demand, while a lack of fresh deals weighed on rates of the staple in other major exporters in Asia.
Top exporter India’s 5 percent broken parboiled rice prices fell by $15 per tonne to $432-$436 after rising to the highest level since September 2011 last week.
“Thailand has cut prices sharply in last few days. Buyers are now expecting a further reduction in prices by all sellers,” said an exporter based in Kakinada in the southern state of Andhra Pradesh.
The exporters managed to cut prices by a few dollars due to the depreciating rupee, said another exporter in Kakinada.
The rupee has fallen more than one percent so far this month, increasing exporters’ margins from overseas sales.
India’s non basmati rice exports during April-December jumped 39.5 percent from a year ago to 6.34 million tonnes as Bangladesh and Benin raised purchases.
Thailand’s benchmark 5 percent broken rice rates fell to $420-$430 per tonne, free-on-board (FOB) Bangkok, from $443-$446 last week with new harvest produce expected to hit the market towards the end of February, and the lack of new orders from overseas, exporters said.
“We have to watch the Indonesian market closely. There is a chance that they will order more and that would push up prices,” said a Thai rice trader, alluding to a recent buying order from Indonesia that had boosted Thai rice prices in previous weeks.
Indonesia’s state food procurement agency Bulog said on Wednesday it signed contracts with six companies for 281,000 tonnes of rice imports.
Bulog will import 141,000 tonnes from Vietnam, 120,000 tonnes from Thailand and 20,000 tonnes from India.
Thai traders were also eyeing potential orders from the Philippines, said another Bangkok-based trader.
However, an official at a government panel in Philippines that decides on its imports, on Wednesday said the country is facing no urgency to import rice despite a fall in stocks to the lowest in over two decades.
Prices eased in Vietnam as well, as activity slowed ahead of the country’s biggest holiday, the Lunar New Year, locally known as Tet, which will be observed from Feb. 14 to Feb. 20, traders said.
Vietnam’s 5 percent broken rice prices dipped to $420-$425 a tonne, FOB Saigon, from $440-$450 previously.
“Everyone in this market is busy cleaning up storages and partying for Tet; who cares about trading,” said a Ho Chi Minh City-based trader.
Prices could ease further in late February or early March during the harvest for the winter-spring paddy, traders said.