Rice prices slip as harvest peaks, demand thins in Asia

Monday, 3 January 2011 00:30 - - {{hitsCtrl.values.hits}}

Reuters: Thai rice prices eased last week on rising supply as its harvest peaked at a time of slow demand due to year-end holidays, traders said.

The benchmark 100 per cent B grade white rice RI-THWHB-P1 slipped to $ 535 per tonne from previous week’s $ 540, they said.

“The market is very quiet as everybody is in a holiday mood and buyers can wait a few weeks to see whether prices are going to fall further,” a Bangkok-based trader said.

Thai prices got some limited support from demand from Iraq, which bought some 30,000 tonnes of Thai rice in a recent tender.

Thailand, the world’s biggest rice exporter, is harvesting its 2010/11 main crop, with 22.6 million tonnes of paddy expected to come into the market. Traders said that would push prices down further.

In Vietnam, the second-biggest exporter, rice trade was also slow ahead of the year-end and the official floor price for its five per cent broken grade rice was cut to $520 per tonne from $ 540.

However, the Vietnam Food Association has raised the floor price for its 25 per cent broken rice to $ 490 a tonne from $ 480, anticipating a rise in demand early next year.

Exporters and industry officials said they were looking for fresh demand next year from South Korea, Japan and Bangladesh because India, in the past another big supplier, had maintained its ban on non-basmati rice exports.

Vietnam expects to export six million tonnes of rice in 2011, Chairman Truong Thanh Phong of the food association said in an interview published on Wednesday by an Agriculture Ministry newspaper.

Rice exports in 2010 rose an estimated 14.6 per cent from last year to a record of 6.83 million tonnes, the Government said.

Thai exporters were due to meet officials at the Ministry of Commerce to discuss the outlook for rice exports in 2011 and could forecast 2011’s export target.