Rice markets in major Asian centres remained muted this week, with trades few and far between due to the holiday season and the approaching year-end, while Bangladesh awaited shipments from India as part of a previously announced deal.
Bangladesh, which has emerged as a major importer this year after floods damaged its crops, has signed a deal, announced earlier this month, to import 150,000 tonnes of rice from India at US$440 a tonne, Badrul Hasan, head of Dhaka’s state grains buyer, told Reuters on Thursday.
Another deal with Thailand to import 150,000 tonnes of parboiled rice at US$465 a tonne could be signed next week, he added.
“We have already purchased or finalised deals to fulfil our target,” said Hasan, adding that the state grains buyer aims to import 1.5 million tonnes in the year to June 2018.
The cost of rice imports has increased in recent weeks due to weakening of the local currency against the dollar, amid an appreciation in the Indian rupee, a Dhaka-based trader said.
In August, Bangladesh cut a duty on imports of the grain for the second time in two months to boost stocks and combat high domestic rates, prompting purchases by private dealers, with most of the deals being struck with neighbouring India.
In top exporter India, the 5 per cent broken parboiled rice prices were unchanged from last week’s US$418-US$421 per tonne level.
“Due to Christmas and New Year holidays, trading volume is down significantly. Traders are in vacation mood,” said an exporter based in Kakinada in the southern state of Andhra Pradesh.
The Indian rupee was trading near its highest level in three months, slashing exporters’ returns from overseas sales.
“The appreciating rupee is keeping prices firm for overseas buyers. In the last few days, demand from Bangladesh has been weak,” said another exporter in Kakinada.
In Thailand, the benchmark 5 percent broken rice ticked up to US$398-US$400, free-on-board (FOB) Bangkok, from US$390-US$398 last week, even as the market remained subdued, traders said.
Trade was quiet as the end of the year approaches and foreign buyers are not placing orders, a Bangkok-based trader.
Meanwhile, the Thai Rice Exporters Association forecast rice exports to exceed 11 million tonnes in 2017, a record high.
“Some of that is old rice in state warehouses, as announced by the commerce ministry,” the trader said.
The market for the staple grain remained quiet in Vietnam as well, with traders quoting the benchmark 5 per cent broken rice at US$390-395 a tonne, free-on-board (FOB) Saigon, the same as last week.
Rice exports from Vietnam in December were forecast higher than last month at 400,000 tonnes, a government report said, with traders attributing the increase to shipment of previously signed deals.