Asia rice: High shipping cost dents Indian rates
This week, India’s 5% broken parboiled rice was quoted at $541-$548 per ton, slightly down from last week’s range amid surging container freight rates prompting a shift to break bulk shipping. Meanwhile, Thailand’s 5% broken rice fell to $595 per ton due to exchange rate fluctuations and slower demand amidst competitive pricing from Vietnam. Vietnam’s 5% broken rice prices held steady at $575-$580 per ton, benefiting from a recent import tariff cut by the Philippines, despite ample supplies from ongoing harvests.
Top exporter India’s 5% broken parboiled variety was quoted at $541-$548 per ton this week, down from last week’s $544-$552. “In the last month, container freight rates have surged, forcing buyers to move to break bulk. However, even break bulk rates have increased, causing buyers to pause,” said an exporter based in Kakinada in southern Andhra Pradesh state of India.
The Baltic Exchange’s main sea freight index, which tracks rates for ships ferrying dry bulk commodities, rose on Wednesday on the back of higher rates for capesize vessels.
Elsewhere, Thailand’s 5% broken rice dropped to $595 per ton on Thursday, down from $615 to $620 last week. Traders attribute the price drop to the exchange rate and slower demand amid more competitive prices from major rice export competitors like Vietnam. “As the prices drop in Vietnam, it will be very difficult for us to sell rice if Thai prices remain high,” a Bangkok-based trader said. The market anticipates a good yield of new supply next month due to good rainfall, the same trader said.
Vietnam’s 5% broken rice were offered at $575-$580 per metric ton on Thursday, up from $570 a week ago, but still about $18 cheaper than the Thai variety.
“Prices edged higher after the Philippine president issued a decision to cut import tariff on rice,” a trader based in Ho Chi Minh City said, adding that farmers in the Philippines are said to be complaining about the decision. The trader said prices won’t likely rise much due to ample supplies amid an ongoing harvest.
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