Indian rice prices fell as overseas demand waned while prices in Vietnam rose with some traders speeding up purchases to complete their signed February export orders amid thin supplies.
India's 5-percent broken parboiled rice prices edged down by $3 per tonne this week to $373 to $378 per tonne as exports slowed down after weeks of strong demand.
"African buyers are reducing purchases after buying actively in the last few weeks. Prices rose sharply in the last one month compared to prices in Thailand and Vietnam," said an exporter based at Kakinada in Andhra Pradesh.
India, the world's biggest rice exporter, is likely to produce a record high 108.86 million tonnes of rice in the 2016/2017 crop year, its farm ministry said on Wednesday.
The country's 2016 exports of the grain fell 10 percent annually to 10.1 million tonnes, according to a December U.N. Food and Agriculture Organization report. India mainly exports non-basmati rice to African countries and premier basmati rice to the Middle East.
"The downside in Indian export prices is limited. Rupee has been appreciating consistently in last few weeks and slashing exporters' margin," said a Mumbai-based dealer with a global trading firm.
In Vietnam, the world's third largest rice exporter, the 5-percent broken rice prices rose to $350-$355 a tonne, from $345-$350 a tonne a week earlier, traders said. Local prices have risen even stronger, they added.
"Harvest has started but has been only a little, while some traders are willing to pay a higher price to complete their previously signed Philippine contracts," said a Ho Chi Minh City-based trader.
Prices rose on expectations of potential orders from the Philippines, but could fall in the next two weeks when Vietnam fully enters the main harvest season which lasts until end-March, said another Vietnamese trader.
Meanwhile, prices in Thailand were stable at around $350-$355 a tonne for the 5-percent broken rice, free-on-board Bangkok, and the best offer could reach $355-$360, traders said.
"As for overseas orders, they are still small, nothing big. As for next week's prices, it should remain steady and around the current range which is normal for the market at around this time of year," a Bangkok-based trader said.
"New crops will come into play around March and the government has closed bidding on rice in its stockpile," the trader added.
Thailand's Ministry of Commerce has set a target to offload its 8-million tonnes of stockpile by the end of the year. The country exported 1.6 million tonnes of rice during Jan. 1- Feb. 14, up 9.9 percent annually, the ministry said.