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Asia Rice: Demand stagnant in export hubs on lack of fresh offers

BENGALURU (Reuters) - Export prices for Indian and Vietnamese rice slipped this week on thin demand while strength in the baht made supplies from Thailand less competitive even as the world’s second-biggest rice exporter struggles to find fresh orders.

Farmers plant saplings in a rice field on the outskirts of Srinagar June 10, 2015. REUTERS/Danish Ismail/Files

For top rice exporter India, prices for the 5% broken parboiled variety were quoted at $365-$367 a tonne this week, down from last week’s $366-$369.

“African buyers are holding ample stocks. They are not in a hurry,” said an exporter based at Kakinada in the southern state of Andhra Pradesh.

India mainly exports non-basmati rice to African countries and premier basmati rice to the Middle East.

Dealers said planting of the summer-sown staple crop could also be delayed with the arrival of monsoon rains expected to be late.

Demand also remained lacklustre in Vietnam, where rates for the 5% broken rice variety retraced to $345- $350 a tonne on Thursday, from $350-$360 last week, traders said.

“The market is quiet at the moment and there aren’t many offers,” said one trader in Ho Chi Minh City.

Pressuring prices was inferior quality produce from the ongoing summer-autumn harvest, another trader added.

In Thailand, rates for the benchmark 5% broken rice were largely unchanged at $393-$404 a tonne on Thursday.

Traders said demand for Thai rice has remained stagnant, with no major deals in sight in the short or medium term.

“We are keeping our eye on the Middle Eastern markets after Ramadan, but so far there are no signs of major deals and most traders are selling rice to their usual customers,” a Bangkok rice trader said.

The growing strength of the baht, which on Thursday touched its highest against the U.S. dollar in nearly four months, continues to levy competitive pressure on staple prices.

“The only factor that will impact the price of rice right now is the currency; the strength of the baht against the U.S. dollar will continue to make Thai rice more expensive than our competitors,” another rice trader said.

Meanwhile, Bangladesh is finding it difficult to export rice despite a drastic fall in domestic prices.

“It won’t be easy for us to make export deals as our produce is (more) expensive than India and Thailand,” a trader in Dhaka said.

The South Asian country, which usually produces parboiled rice, has lifted its long-standing ban on rice exports, hoping to sell as much as 1.5 million tonnes to support farmers after a sharp drop in prices.

Reporting by Panu Wongcha-um in Bangkok, Kham Nguyen in Hanoi, Rajendra Jadhav in Mumbai and Ruma Paul in Dhaka; Additional reporting by Arijit Bose; Editing by David Goodman