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Rice rates in India slide to multi-year lows as supply mounts

BENGALURU (Reuters) - Prices of rice in top exporter India slid to a three-year low this week as demand waned on ample supply from the recent summer harvest, while demand from Philippines picked up for the Vietnamese variety.

Rates for India’s 5% broken parboiled variety were quoted around $356-$361 per tonne this week, the lowest since January 2017 and down from last week’s $358-$362.

“The supplies from new crop are rising, but demand is not picking up,” said an exporter based at Kakinada in the Indian state of Andhra Pradesh.

India’s rice exports in October fell 42% year-on-year to 485,898 tonnes, government data showed on Thursday, due to weak demand from African countries for non-basmati varieties.

In Vietnam, rates for 5% broken rice were quoted at $345 a tonne on Thursday, compared with a range of $345-$350 a week earlier.

“Demand from the Philippines has been picking up, with more orders coming in,” a Ho Chi Minh City-based trader said, adding that exporters, meanwhile, are focusing on fulfilling orders signed earlier with clients from Iraq and Cuba.

Farmers in the country’s largest rice growing area, the Mekong Delta, are preparing land for the key winter-spring crop, but traders fear the rice quality of the crop might not be as high as before.

“The lack of floods over the recent years in the Mekong Delta has left the land less fertile,” the trader said.

In Bangladesh, domestic prices of rice have fallen slightly this week after the government vowed stern action against the manipulators and considered a cut of import duties on the staple.

Prices had rebounded in the past few weeks, despite good crops and ample stocks, which the food minister attributed to price manipulation by some traders.

Bangladesh raised import duty to 55% from 28% in May, in an effort to support farmers amid protests over a steep fall in domestic prices.

Export prices for Thai variety were little changed this week on subdued demand and as new supply gradually enters the market.

“Prices have not changed much this week because of the lack of demand,” a Bangkok-based trader said.

Thailand’s benchmark 5% broken rice prices narrowed to $397-$410 a tonne on Thursday from $394 - $410 the week before.

Traders said they continue to struggle to sell rice as a strong baht kept prices for Thai varieties higher than competitors.

Reporting by Rajendra Jadhav in Mumbai, Ruma Paul in Dhaka, Khanh Vu in Hanoi and Panu Wongcha-um in Bangkok; Editing by Rashmi Aich