Demand for Indian rice export has increased in South East Asian countries
China starts to purchase rice from India after 3 decades.
India is one of the top rice exporters around the world and China is one of the top rice importers. Beijing purchases rice around 4 Mn MTS per year but had avoided buying from India, due to quality concerns. One of the Indian industry officials said that China has started importing Indian rice for the first time in at least 3 decades due to shrinking rice supplies from Thailand, Myanmar, and Vietnam and an offer of low rice prices. President of the Rice Exporters Association, B.V. Krishna Rao said that for the first time China has bought Indian rice and they may increase purchasing the next year 2021 after witnessing the quality of Indian rice. Industry officials said that Indian rice traders have signed to export 100,000 MTS of broken rice for December 2020 to February 2021 shipments at roughly $300 per MTS on a free-on-board (FOB) basis.
One Indian rice trade official said that China’s normal rice suppliers, such as Thailand, Vietnam, Myanmar, and Pakistan, have inadequate surplus rice supplies for export and were offering at least $30 per MTS higher compared to Indian rice prices. Thailand, the world’s second top rice exporter and major rice supplier to China, experienced a drought this year 2020 that has affected the rice harvest. Thailand’s rice export in 2020 might fall to 6.5 Mn MTS, the lowest in 20 years.
Indian parboiled markets witnessed a more bullish sentiment in the previous week as rice traders indicated an improved demand through long positions in the market. As the crisis in the container sector continued and escalation of freights remained a concern for key rice exporters. This crisis has also led to a demand in a breakbulk segment as well. Whereas Bangladesh announced its second bid last week. While Indian white rice markets took a bullish turn as rice exporters witnessed the completion of breakbulk vessels at Vizag.
In Thailand rice export price for 5 percent broken rice increased to $480-$516 per MTS from $480-$490 per MTS from the previous week. One rice exporter said that produce was halted, and rice millers were holding on to current rice supplies, tightening rice supply and increasing rice prices.
In Vietnam, rice export price for 5 percent broken white rice decreased to $470-$490 per MTS from $495-$500 per MTS from the previous week. One rice trader said that the Vietnam rice market has remained still recently as rice exporters are waiting for the result of the 12th online World Rice Conference. The rice trader added that they expect rice prices to decrease further until 2021 when one of the top rice importing countries the Philippines is anticipated to purchase more rice from Vietnam after a recent flood in the country.
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