Climbing Rice Export Prices in India
Published on: June 21, 2024.
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India’s Rice Export Prices Rise as Demand Increases
India’s rice export prices have reached a nearly three-month high this week due to an increase in demand and a rise in government paddy procurement prices for the new season. The Indian government has raised the price at which it will purchase new-season common rice paddy from farmers by 5.4% to 2,300 rupees ($27) per 100 kg. This increase in paddy prices is expected to affect the export prices of rice as well.
Despite the hike in prices, overseas buyers are still expected to make purchases as Indian rice remains cheaper compared to rice from other countries. A trader in Mumbai mentioned that Indian rice is priced more competitively even after factoring in the price hike. India, being a top exporter, has reported that its 5% broken parboiled variety of rice is quoted at around $544-$552 per ton, higher than last week’s range of $539-$546.
In comparison, Vietnam’s 5% broken rice is currently offered at $570 per ton, down from last week’s price range of $570-$575. However, trading activity in Vietnam is currently weak due to buyers halting their purchases in anticipation of the Philippines officially cutting its import tariff on rice. The decision to cut the tariff is pending final approval from the Philippines’ president, which is likely to occur in July or September.
Export prices are also influenced by domestic paddy prices, which are currently in tandem with the ongoing harvest in the Mekong Delta area of Vietnam. This harvest season is expected to conclude in early July. Meanwhile, Thailand’s 5% broken rice has experienced a slight decrease in prices, slipping to $615-$620 per ton from last week’s price of $630. This decline in prices is attributed to weaker demand, as Thai rice prices were higher than those of Vietnam.
In conclusion, India’s rice export prices have risen due to increased demand and the government’s rise in paddy procurement prices. Despite the price hike, Indian rice remains competitively priced and continues to attract overseas buyers. Vietnam and Thailand have also experienced fluctuations in their rice prices, influenced by factors such as pending decisions on import tariffs and differing demand levels.
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