Buyers opt for cheaper Pakistani rice
BANGKOK: Vietnamese rice prices were quoted a touch lower in places due to thin demand as buyers opted for cheaper grain from India and Pakistan, while Thai prices stayed at relatively firm levels, supported by government intervention, traders said on Wednesday.
Vietnam’s 5 per cent broken rice was offered at $445-$460 a tonne, on a free on board basis at Saigon Port, compared with a narrower range of $450-$455 last Wednesday.
The 25 per cent broken grain stood at $420-$430 a tonne versus $420-$425 a week ago. “Some buyers said they could take rice from Pakistan at $420 a tonne,” said a trader in Ho Chi Minh City, adding that overall the market was quiet.
Traders in Bangkok said Pakistan’s common 5 per cent broken grade was offered at $435-$445 a tonne, however, close to the same grade in India at $425-$435 per tonne.
In contrast, the price for that grade in Thailand stayed at the uncompetitive level of $550 per tonne.
On Tuesday, Indonesia’s state procurement body Bulog said it was in talks with India to buy 100,000-150,000 tonnes of rice to boost stocks.
“Thai exporters, including me, also sought Pakistani rice, which I want to ship to my customers in China as Thai rice prices are too high,” said a trader at a leading Thai exporting firm.
With uncompetitive prices, Thai exports continued to fall and the country is in danger of losing its position as the world’s biggest rice exporter this year.
The Thai government is paying farmers 15,000 baht per tonne for their unmilled rice, two-thirds more than the 9,000 baht that millers say is the real market level, pushing export prices way above those of rival countries.
As a result, Thailand has exported 5 million tonnes so far this year, down 44 per cent from the same period in 2011, when it sold 9 million tonnes.
The controversy over the intervention scheme is now spreading beyond Thailand.
The United States has said it would challenge Thailand over the subsidies at a committee meeting at the World Trade Organisation this week, arguing that the government’s huge stockpiles could end up on the world market and depress prices, hurting US exporters. Vietnam is aiming for record exports this year of 7.5-7.7 million tonnes, a level that might see it overtake Thailand as top exporter.
Vietnamese exports rose 8 per cent in the year to October to 6.89 million tonnes, customs data showed this week.