• Bangladesh has issued a series of rice purchase tenders in recent months amid dwindling supplies and a surge in prices
• HAMBURG: Bangladesh's state grains buyer has issued another international tender to purchase 50,000 tonnes of rice, traders said on Monday. The deadline for submitting price offers is March 28. It is the third rice tender issued by Bangladesh. Two previous tenders for 50,000 tonnes of rice from Bangladesh close on March 18 and March 24. Bangladesh, which has emerged as a major rice buyer as it seeks to replenish flood-damaged stocks, will buy 350,000 tonnes, including 150,000 tonnes each from India and Thailand and 50,000 tonnes from Vietnam, in state-to-state deals, a food ministry official said. Bangladesh has issued a series of rice purchase tenders in recent months amid dwindling supplies and a surge in prices. The new tender again seeks price offers for non-basmati parboiled rice in CIF liner out terms, including some ship unloading costs, for shipment to the ports of Chattogram and Mongla. The rice can come from worldwide origins and shipment is required 40 days after contract award.

The lowest offer in a Bangladesh tender to buy 50,000 tonnes of parboiled rice that closed on Monday was $405.60 a tonne, including freight, insurance and other expenses, an official from the state grains buyer said.

India’s ETC Agro made the lowest offer while only other bidder took part in the tender, with the rice to be shipped within 40 days of signing the deal. The offer will now be submitted to the cabinet purchase committee for approval.

The source of the rice is believed to be of Indian origin, the official said.

Historically the world’s third-biggest rice producer, Bangladesh has emerged as a big importer of the grain lately due to depleted stocks and record local prices after repeated flooding ravaged its crop.

Bangladesh is cutting the duty on rice imports to 25% from 62.5% while allowing private traders to import the grain up to a certain level, in an effort to bolster reserves and cool record prices, the country’s food minister said.

The government is also rushing to build buffer stocks as it aims to import as much as 500,000 tonnes of rice in the year to June.

Apart from tenders, it is finalising the purchase of 150,000 tonnes of rice from India’s state firm NAFED, officials said, in what would be the first such bilateral deal in three years.

* Seventh tender since May after floods hit local output

* State grains buyer looks to import 1.2 mln T of rice

* Seeking imports both in government deals and tenders (Add details of import plan)

DHAKA, Aug 1 (Reuters) - Bangladesh's state grain buyer has issued its seventh international tender since May to import 50,000 tonnes of parboiled rice in an effort to replenish reserves.

Bangladesh, the world's fourth-biggest rice producer, has emerged as a major importer of the grain this year after flash floods in April hit domestic output. As a result, the country is facing dwindling stocks and high local prices.

The deadline for offers in the tender is Aug. 20, with the rice to be shipped within 40 days of signing any deal, a senior official at the country's state grains buyer said.

The country has also been importing rice via state-to-state deals.

“We’ll be issuing tenders and at the same time looking for government deals until our import target is fulfilled,” Badrul Hasan, the head of Bangladesh's state grain buyer told Reuters.

The state grain buyer aims to import as much as 1.2 million tonnes this year, and has so far struck deals with Vietnam.

But plans to import from India and Thailand could be suspended because of high prices and the government is already looking to Cambodia to replenish stocks.

A Bangladeshi delegation, led by Food Minister Kamrul Islam, will visit Cambodia this week to sign a memorandum to import rice, ministry officials said.

Bangladesh bought 200,000 tonnes of Vietnamese white rice at $430 a tonne and 50,000 tonnes of parboiled rice at $470 a tonne in a state-to-state deal - at rates much higher than in previous tenders.

The lowest offer in the fifth tender by the state grains buyer for 50,000 tonnes of parboiled rice, which opened last Thursday, was from Olam at $419.51 a tonne, CIF liner out.

The sixth tender for a similar quantity of rice will close on Aug. 8.

Private traders have imported around 150,000 tonnes of rice from neighbouring India after the government cut import duties in late June.

Vietnamese rice prices in May hit their highest in over a year

Bangladesh is set to buy 250,000 tonnes of white and parboiled rice from Vietnam at prices $50-$90 higher per ton than the previous month, to maintain immediate availability of stock in the market, as well as reserves. According to the food ministry proposal, the government will be importing 200,000 tonnes of white rice at $430 per ton, though the price per ton was $380 in the last month. The ministry is also planning on procuring 50,000 tonnes of parboiled rice at a cost of $470 per ton, while the price had been less than $450 just a week ago. In addition, in a recent international tender by the food ministry, parboiled rice was listed at $ 427.85 per tonne and white rice was at $406.48. The country’s rice stock has hit a 5 year low, at 193,000 tonnes.

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The food ministry’s proposal to import the specified amount of rice will be placed before the cabinet committee for public purchase on Wednesday, requesting Tk908.85 crore in funds. Finance minister AMA Muhith will preside over the meeting, according to a procurement official. Vietnamese rice prices in May hit their highest in over a year on expectations of strong demand from top importing countries such as Bangladesh and the Philippines. Cost per kg of the parboiled rice imported from Vietnam will stand at Tk39.01, while it will be Tk35.69 for white rice.

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Also Read- Bangladesh to speed up rice imports in wake of flooding

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An official of the Finance Division said that the government allocation to procure wheat and rice from domestic sources was not utilised as high prices were demanded by farmers and rice millers. The situation arose as the government had set the price of rice at Tk37.40 per kilogram, at a time when coarse rice was selling at between Tk45 and Tk50 per kilogram. During a question and answer session at Jatiya Sangsad last week, Food Minister Qamrul Islam had said rice reserves were slightly lower compared to the same time last year.

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Also Read- Vietnam and Bangladesh extend rice trade deal to 2022

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“The government has already planned to import 600,000 metric tonnes of rice from abroad to meet the shortfall in the crop due to premature flooding in the Haor region,” he said. The minister had also said that, as per the plan, the government has already called for international tenders for the import of 300,000 metric tonnes of rice. Earlier in the year, on May 23, the food minister had signed an MoU to finalise the rice imports with Vietnamese Industry and Trade Minister Tran Tuan Anh in a government-to-government deal, during a Bangladeshi delegation’s visit to the country.

The lowest offer in the tender from Bangladesh’s state grains buyer to purchase 50,000 tonnes of parboiled rice was $445.11 a tonne CIF liner out, officials in Bangladesh and European traders said on Monday.

The offer was made by trading house Olam.

The tender had closed on 11 June and the rice is to be shipped within 40 days of contract signing.

No purchase has yet been made and offers are still being considered, European traders added.

They said the other offers in the tender in dollars a tonne CIF liner out were: Agro Corp at $449.55, Singsong Food at $458.00, Desh Trading at $459.67, Amir Chand at $474.00 and Sukhbir Agro at $459.30.

Bangladesh has started a new programme to import rice to build reserves and cool local prices after sudden floods damaged local crops.

Domestic rice prices reached record highs in May and state reserves are at six-year lows in the wake of the flooding that wiped out around 700,000 tonnes of Bangladesh’s rice crops.

The state grains buyer said it would import 600,000 tonnes of rice after the flooding, initially issuing two tenders for a total of 100,000 tonnes of rice, its first such tenders since 2011.

Bangladesh received a lowest offer of $406.48 a tonne CIF liner out from Singapore-based Agrocorp International in a tender that opened on Sunday to import 50,000 tonnes of white rice, officials at the state grains buyer said.

Five traders competed for the tender issued by the Directorate General of Food at a time when local rice prices have reached record highs and state reserves are at 10-year lows.

Other offers in a tonne CIF liner out were: LDC $413.13, Olam $413.90, Phoenix $421.00 and Desh Trading $446.70, the officials said.

One trader said the origin of the lowest offer was not known but was likely to be from Vietnam.

A Bangldesh delegation was in Vietnam last week to finalise imports of the staple grain in a government-to-government deal, Food Ministry officials said.

Vietnamese rice prices this week hit their highest in over a year on expectations of strong demand from top importing countries such as Bangladesh and the Philippines.

The state grains buyer earlier this month said it would ship in 600,000 tonnes of rice, initially issuing two tenders for a total of 100,000 tonnes of rice, its first such tenders since 2011.

In its first tender that opened last week, it received a lowest offer of $427.85 a tonne CIF liner out from Dubai-based Sukhbir Agro Energy to import 50,000 tonnes of parboiled rice.