Asia rice: Philippine import deal fails to lift prices

Thursday, 31 May 2012 01:18 - - {{hitsCtrl.values.hits}}

BANGKOK (Reuters): Demand from the Philippines failed to lift Asian rice prices which are already weighed down by the prospect of rising supplies from major exporting countries and record high stocks held by the Thai government, traders said on Wednesday.

The Philippines’s National Food Authority (NFA) said it was seeking government approval to award a 100,000-tonne rice import deal to Vietnam, but traders said the deal was too small to affect the market.

“The deal has no impact on the rice market. I think it is too small to push up prices and demand elsewhere remains thin,” said a Bangkok-based trader.

The 5 percent Vietnamese broken rice eased to $420-$425 a ton, free on board Saigon Port, from $420-$440 last Wednesday.

The 25-percent broken grade edged up at $385-$390 a ton, FOB basis, from $380-$390 a week ago.

“Buyers are not around and there have been no transactions on the market to get a benchmark price, so offers are only based on domestic prices,” an exporter in Ho Chi Minh City said.

Thai rice prices also fell amid thin trade. The benchmark 100 percent B grade Thai white rice was at $610 per ton on Wednesday, down from last week’s $630, traders said.

Supplies of rice in Thailand and Vietnam, the world’s biggest and the second-biggest exporters, are expected to rise significantly over the next few weeks, traders said.

Thailand was due to harvest an off-season rice crop, which farmers in some well-irrigated areas normally grow after they reap the second crop.

“We expect to have around 3 million tons of extra rice output from the crop, which is due to be harvested in the next few weeks and supply is likely to peak in July,” said a senior Agriculture Ministry official.

The Thai government is also holding record high rice stocks of 13.9 million tons of paddy, which kept prices lower, traders said.

In Vietnam, supplies of the summer-autumn paddy are expected to pick up next month before peaking in July, traders said.

Vietnam is forecast to export 6.25 million tons of rice this year, the Agriculture Ministry said on Wednesday, an increase of nearly 16 percent from an earlier projection of 5.4 million.