BENGALURU: Rice prices in India edged up this week, buoyed by a stronger rupee, while export demand in Thailand and Vietnam slowed ahead of the upcoming Christmas and New Year holidays.
In top exporter India, 5 percent broken parboiled rice prices gained $2 per tonne to $418-$421 per tonne.
"Export prices have gone up marginally to offset the impact of the higher rupee," said an exporter based in Kakinada in the southern state of Andhra Pradesh.
The dollar/rupee exchange rate rose to the highest level in three months earlier this week, pushing up rice prices in dollar terms and slashing exporters returns from overseas sales.
Aggressive government buying and export demand from Bangladesh were also giving support to prices, said another exporter based in Kakinada.
The government buys rice from local farmers at a fixed price for subsidised food inventories and to meet any emergency needs such as a sudden spike in prices.
Bangladesh, which has emerged as a major importer this year after floods damaged its crops, will import 150,000 tonnes of rice from India in a state deal priced at $440 a tonne, two food ministry officials said earlier this month.
In Thailand and Vietnam, the world's second and third biggest rice exporters, demand is expected to remain light until the start of next year.
"Next month I expect there to be deals with African countries as well as Indonesia and Philippines. Until then, demand and prices should remain constant," said a Bangkok-based trader.
Thailand's benchmark 5 percent broken rice price was quoted at $390-$398, free-on-board (FOB) Bangkok, compared with $390-$400 a tonne last week.
However, some traders, citing lower supplies due to the end of the harvest season, were optimistic that the government would intervene with subsidies when new crops come to the market.
"Supply is low right now ... new crops should come out in January or February next year. The government should have measures in place to help farmers," the Bangkok-based trader said.
Meanwhile, the rice market in Vietnam also remained muted as fresh supply was not ready at the start of new crop season.
Traders quoted 5 percent broken rice <RI-VNBKN5-P1> at $390-395 a tonne, free-on-board (FOB) Saigon, compared with $390-400 last week.
"This week's price range for Vietnamese rice tightened but trading was still thin, because the prices were still high," a trader in Ho Chi Minh City said.
Another trader attributed thin trading to low demand from the major importers like China and African countries.
"China bought some rice from us but only to reach their import quota this year," he said.
Source: economictimes.indiatimes.com