India, the largest rice grower after China, is set to surpass Thailand to match Vietnam as the world's biggest shipper after favorable weather and higher government prices boosted the harvest to a record.
Exports may climb to seven million metric tonnes in the year ending Aug 31, said Samarendu Mohanty, a senior economist at the International Rice Research Institute. That’s more than double the 2.8 million tonnes shipped in 2010 to 2011, according to the United States Department of Agriculture. Vietnam will export seven million tonnes and Thailand 6.5 million tonnes, USDA data show.
Rice, the staple for half the world, has slumped 17 per cent since reaching the highest price since Sept 2008 after India ended a three-year ban on exports of non-basmati varieties. Prices will probably stay under pressure in coming months as global production outpaces demand for an eighth year. That may extend a decline in global food costs, which fell for the first time this year in April, United Nations data show. Thailand was the top shipper last year with 10.6 million tonnes.
"There is a possibility of India emerging as the largest exporter," Mohanty said in a phone interview from Manila. A good harvest will allow the country to continue exports next year, said Vijay Setia, president of the All India Rice Exporters' Association. The next crop may be even higher as yields are increasing, he said.
Rough-rice futures for July were little changed at US$15.30 per 100 pounds on the Chicago Board of Trade at 10:36am Singapore time Wednesday. Futures reached $18.54 in September.
The harvest in India may climb 7.7 per cent to 103.4 million tonnes from 96 million tonnes a year earlier, according to the farm ministry. State reserves of rice and wheat jumped 21 per cent to 53.4 million tonnes as of April 1, said the Food Corp of India. The minimum purchase price of the common variety of raw rice was increased to an all-time high of 1,080 rupees ($20) per 100 kilogrammes (220 pounds) in June from 1,000 rupees.
Exports of non-basmati varieties exceeded four million tonnes since the ban was scrapped, according to government data. Indian shipments this year will represent 21 per cent of global trade estimated at 33.9 million tonnes by the USDA.
Global paddy production in 2012 is expected to increase 1.7 per cent to 732.3 million tonnes, equivalent to 488.2 million tonnes of milled rice, exceeding consumption at 477 million tonnes and boosting inventories, the Rome-based Food and Agriculture Organisation said May 4 in its first forecast for 2012 to 2013.
Prime Minister Yingluck Shinawatra's attempts to boost farmer incomes through state purchases since taking power in August has slowed exports and created opportunities for India, said Mohanty. Indian rice is about $100 cheaper than supplies from Thailand, which is paying above market rates to farmers, he said. The Southeast Asian nation has bought eight million tonnes from growers so far, he said.
The free-on-board price of 25 per cent broken long-grain white rice in Thailand costs as much as $520 a tonne compared with $385 a tonne in India, said Setia from the exporters' association. "We are very competitive compared with Thailand because of a large surplus and a weaker rupee."
The Indian rupee has weakened about five per cent against the dollar this quarter, making it the worst performing Asian currency. The Thai baht has dropped 0.8 per cent.
Source : bangkokpost.com