India rice rates at 4-1/2-year low on weak demand, high shipping costs

By Arundhati Sarkar

(Reuters) - Indian rice export prices slipped this week to four-and-a-half year lows due to thin demand and higher shipping costs, while COVID-19 curbs in Vietnam pushed rates to 1-1/2-year lows.

Top exporter India's 5% broken parboiled variety was quoted at $352 to $356 per tonne this week, down from last week's $354 to $358.

"Buyers have taken a pause due to higher freight rates. They are waiting for shipping and container charges to come down," said an exporter based at Kakinada in the southern state of Andhra Pradesh.

Vietnam's 5% broken rice edged lower to $385 per tonne on Thursday - their lowest since February 2020 - from $390 a week earlier.

"Traders are hesitant to sign new export contracts, as they are not sure if they can purchase rice from farmers amid the coronavirus movement restrictions," a trader based in Ho Chi Minh City said.

The trader said high shipping cost also hindered export activities.

Earlier this week, Vietnam's agriculture minister said the country would consider cutting the area under rice cultivation if prices of the grain fell further, to make way for other crops that were more profitable.

Thailand's 5% broken rice prices edged up to $387-$400 per tonne this week, from $380-$395 per tonne a week ago, their lowest in more than two years.

But demand remained largely flat, while a weak baht kept prices at low levels, Bangkok-based traders said.

Meanwhile, Bangladesh cut the import duty on rice to 15% from 25%, the second reduction since December, in an effort to bolster reserves and cool record local prices of the staple grain, officials said.

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

 

(Reporting by Rajendra Jadhav in Mumbai, Ruma Paul in Dhaka and Patpicha Tanakasempipat in Bangkok; Editing by Subhranshu Sahu)