India’s Rice Exports Face Pressure as Prices Drop to Near Two-Year Low
India’s rice export prices have fallen to a near two-year low this week, driven by a weak rupee and increased supply, while demand remains subdued. The situation is part of a broader trend affecting key Asian rice markets, with prices in other regions also showing signs of decline.
India’s Rice Export Prices Slide
India’s 5% broken parboiled rice was priced at $382-$389 per ton, down from the previous week’s $384-$391. Indian 5% broken white rice was priced at $375 to $381 per ton this week. The decline in export prices is attributed to the weakening Indian rupee, which has made Indian rice more expensive for international buyers.
“Export prices are coming down because of falling rupee. Demand is still subdued,” said a New Delhi-based dealer with a global trade house. Industry executives note that global rice prices, which have already dropped to multi-year lows, are unlikely to fall further, but the combination of large Indian stockpiles and a bumper Asian crop is expected to limit any rebound this year.
Thailand’s Rice Prices Drop Amid Quiet Demand
Thailand’s 5% broken rice is quoted between $405 to $410 per ton, down from $410 last week. Traders attribute the price drop to exchange rate fluctuations rather than a drop in demand, which has been quiet this year. “It’s very quiet this year. Indonesia and the Philippines, which used to buy a lot, have enough production,” said a Bangkok-based trader.
Another trader noted that while demand is not entirely absent, it is not as robust as in previous years. “Demand is not that quiet, but it’s not so flashy,” the trader said, adding that supply is good and another crop will be released in July.
Vietnam’s Rice Prices Remain Stable
Vietnam’s 5% broken rice was offered at $397 per metric ton on Thursday, unchanged from the previous week, according to the Vietnam Food Association. Traders in Ho Chi Minh City said that external demand remains weak, which has also pushed down domestic paddy prices amid the summer-autumn harvest.
Prices for fresh unhusked paddy in the Mekong Delta range from 5,200 dong to 6,800 dong per kilogram, down from 5,400-7,200 dong a week ago. The weak demand and high supply have kept prices in check, but the situation is expected to change as the new crop is released in July.
Bangladesh Faces Challenges in Rice Production
Bangladesh’s Aush rice output fell for a fourth straight year to 2.7 million tonnes, down from 2.9 million tonnes last year. The drop is attributed to erratic weather and reduced acreage. Experts warn that the sustained decline could pose long-term food security risks for the country.
The situation in Bangladesh highlights the broader challenges faced by rice producers in Asia, as weather conditions and production levels continue to impact global markets. The combination of high supply and weak demand is expected to keep prices in check for the foreseeable future.
As the global rice market continues to adjust to changing conditions, the role of supply and demand remains critical in determining prices. The situation in India, Thailand, Vietnam, and Bangladesh underscores the complex interplay of factors affecting the global rice trade.