Higher freight charges impacting rice price
Logistics costs increased by over 50 percent.
The Punjab Rice Millers and Exporters’ Industry is alarmed over increasing logistics costs by more than 50 percent for shipping the export cargo to ports in Gujarat and Maharashtra thereby disturbing the rice export. The association has appealed to the district administration and the police officials to mediate and disband such truck unions, allowing the free movement of goods throughout the country. The association said Amritsar alone reported over 1,000 trucks every month containing basmati and non-basmati rice shipment to various parts of the country and for exports. Because of the COVID-19 pandemic, some cargos are left stranded in the port. Moreover, some cargos are not reaching up to the port due to the increase in rice prices. On the other hand, even though retail giants are facing issues, they are manageable. However, small companies are encountering the rage of the disturbed supply chain. For example, rice exporters who cannot afford cargo delays must pay 3 times the standard freight prices. Overall the disruptive supply chain leading to price hikes has to lead to an alarming situation for rice exporters in India as well as other rice exporting countries.
Vietnam's 5 percent broken white rice export prices reached more than 16-month slumps, dropping sharply to $395-$400 per MTS from the previous week’s $465-$470 per MTS. One rice exporter said that rice export demand is low, while rice prices proposed by other rice exporting countries for export are extremely low. On the other hand, local rice supplies are piling up as the summer-autumn rice harvest is in a full shift, the rice exporter added. Rice exporters said they have cut down on purchases from farmers due to COVID-19 movement restrictions.
According to the agriculture ministry of Bangladesh, the summer rice crop variety, known as Boro, reached a record 20.9 MM MTS in 2021, due to a good climate. Local rice prices increased approximately 10% from June 2021 despite vast rice imports which are produced to provide more than half of the country's average yearly rice production of about 35 MM MTS.
Thailand's 5 percent broken rice export prices decreased to $395-$410 per MTS from the previous week’s $405-$412 per MTS. One rice trader said that rice export prices continue to decrease because the baht is weakening and there are no rice buyers. The rice trader also added that there were no supply concerns due to sufficient rain.
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