India’s rice rates surge to a near three-month peak on rising demand in Asia
Published on: June 20, 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 peak this week due to an increase in demand and the government’s decision to raise the procurement price for paddy in the new season. The price at which the government will purchase new-season common rice paddy from farmers has been raised by 5.4% to 2,300 rupees ($27) per 100 kg. This rise in paddy prices has led to an increase in the export prices of rice. However, even with the price hike, Indian rice remains cheaper than rice from other countries, making it attractive to overseas buyers.
According to a trader based in Mumbai, the hike in paddy prices will result in higher export prices for rice. Despite this, he believes that international buyers will still make purchases as Indian rice remains competitively priced compared to rice from other origins.
India, the top exporter of rice, has seen its 5% broken parboiled variety increase in price to $544-$552 per ton this week, compared to last week’s range of $539-$546. In contrast, Vietnam’s 5% broken rice has been offered at $570 per ton, slightly lower than the $570-$575 range from a week ago.
The rice market in Asia has seen some fluctuations in prices due to various factors. For example, high shipping costs have affected Vietnam’s rates, while the prices of Thai and Indian variants have remained steady. Traders have observed that buyers are temporarily halting their purchases as they await the Philippines’ official decision to reduce its import tariff on rice. This decision is still pending final approval from the country’s president and is expected to take place in either July or September.
Export prices are also influenced by domestic paddy prices in the Mekong Delta region of Vietnam, where an ongoing harvest is taking place. This harvest is set to conclude in early July, and the prices of rice are expected to adjust accordingly.
In Thailand, the price of 5% broken rice has declined to $615-$620 per ton from last week’s range of $630. The decrease is attributed to weaker demand, as Thai rice prices have been higher than those of Vietnam. However, traders anticipate that the second crop, which will be harvested next month, will have a good yield due to favorable rainfall. This could lead to further price weakening, with prices potentially reaching $610-$615 per ton.
In Bangladesh, officials have reported that extensive flooding caused by heavy rainfall and upstream water from India has submerged large areas of land in the northeastern region. This threatens the rice crops in the affected areas if the water persists for an extended period.
Overall, the rice market in Asia is influenced by a variety of factors, including government policies, harvest seasons, and international demand. These dynamics contribute to price fluctuations and impact the decisions of both buyers and sellers in the market.
Source: [BRecorder](https://www.brecorder.com)
