India rates hit 4-1/2-year low on weak demand, logistical bottlenecks

By Brijesh Patel

(Reuters) -Indian rice export prices fell to their lowest level in four-and-a-half years this week due to thinner demand and logistical bottlenecks, while a softer baht and lack of buyers kept Thai rates near two-year lows for a second straight week.

Top exporter India's 5% broken parboiled variety quotes fell to $354 to $358 per tonne from last week's $361 to $366 a tonne.

Demand is slowing down on easing Thailand prices amid the low availability of containers and vessels, said Nitin Gupta, vice president for Olam India's rice business.

Indian farmers this year have planted paddy rice on 26.5 million hectares as of July 30, down from 27.6 million hectares a year earlier.

Thailand's 5% broken rice prices slightly rose to $385-$410 per tonne on Thursday, from $385-$408 per tonne - their lowest since July 2019 - a week ago.

Traders said supply remained unchanged, while higher shipping costs have hurt export prospects despite low prices.

"Prices now fluctuate mainly by the exchange rate, but the high cost of shipping has muted demand," a Bangkok-based rice trader said.

Meanwhile, prices for Vietnam's 5% broken rice were unchanged at $390 per tonne, their lowest since February 2020.

Domestic supplies are building up amid the summer-autumn harvest in the rice bowl Mekong Delta region, but transactions remain slow due to coronavirus restrictions in the area, traders said.

"Farmers are struggling to sell their newly harvested rice, and many of them are hesitant to continue production into the next crop," a trader based in Ho Chi Minh City said.

Vietnam plans to stockpile rice purchased from domestic farmers to offset the hit from COVID-19 curbs and low export prices, state media reported on Tuesday.

Meanwhile, Bangladesh has approved purchase of 50,000 tonnes of rice from an Indian firm at $377.88 a tonne through an international tender, food ministry officials said.

(Reporting by Rajendra Jadhav in Mumbai and Panu Wongcha-um in Bangkok; Editing by Ramakrishnan M and Shailesh Kuber)