India’s rice rates grind to 2-month low on soft demand

By Reuters

Prices of parboiled rice exported from top hub India slipped to their lowest level since early February this week, pressured by sluggish demand, while Thai rates declined for the fourth consecutive week due to a weaker baht.

Top exporter India’s 5% broken parboiled variety was quoted at $540-$548 per ton this week, down from last week’s $550-$558. Prices hit a record high of $560 last month after customs officials changed the calculation method for the 20% export duty, resulting in a high levy.

Demand from Asian buyers was subdued, which brought down prices from the last month’s highs, said Himanshu Agarwal, executive director at Satyam Balajee, a leading exporter.

Indian exporters have received notices from the customs department demanding payment of duty differentials on rice exported in the last 18 months, four exporters told Reuters, a rare tax demand that could cripple rice shipments from India.

Thailand’s 5% broken rice prices was quoted at $570 per ton, sliding down from $585 to $590 quoted last week.

A Bangkok-based trader said the weaker prices came from a depreciating baht and additional supply coming in. Another trader said the lower prices attracted demand from buyers like Indonesia.

Vietnam’s 5% broken rice was offered at $580 on Thursday, down from $590-$595 a week ago.

“Demand remains healthy, but buyers only offer lower prices,” a trader based in Ho Chi Minh City said.

Traders said the ongoing harvest of the winter-spring crop, the largest of the year, will end in more than a week.

“With the harvest nearing the end, I think prices will soon come up again,” the trader said.

This article has been republished from The Economic Times.