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Asia Rice-Shipping container crunch lifts Vietnam rates to 9-year peak

Friday, December 18, 2020, 09:05 GMT+7
Asia Rice-Shipping container crunch lifts Vietnam rates to 9-year peak
A farmer plants rice on a paddy field outside Hanoi July 4, 2013. Photo: Reuters

Rice export prices in Vietnam jumped to their highest since December 2011 this week, as a shortage of containers sent freight rates soaring and pushed Thai prices of the staple to a near four-month peak.

Prices for Vietnam's 5% broken rice rose to $500 per tonne, their highest since December 2011, from last week's $470-$490.

“A shortage of containers has made it difficult for traders to ship rice to their customers,” a trader based in the Mekong province of An Giang said.

For instance, freight rates for a 20-feet container to Africa has risen to $5,000 from $1,500 a couple of months ago, the trader added.

Vietnam is not likely to meet its target of exporting 6.5 million tonnes of rice this year, traders said.

Government customs data showed exports in the January-November period slid 2.9% year-on-year to 5.7 million tonnes.

Thailand's benchmark 5% broken rice prices rose to $500-$519 from $485-$516 last week due to concerns over supplies and logistics.

Bangkok-based traders said new rice supplies have not arrived, while existing supplies could not be shipped due to the shortage of shipping containers.

Exports fell to 4.49 million tonnes from January to October, down 31% from a year earlier, according to the Thai Rice Exporters Association.

Top exporter India's 5% broken parboiled variety extended gains to $380-$385 per tonne from $378-$383 last week on strong demand and as the rupee jumped to its highest level in nearly two-months.

“Traditional buyers of Thai rice are moving to India due to lower prices,” said an exporter based at Kakinada in the southern state of Andhra Pradesh.

“There is congestion at Kakinada port, where dozens of vessels have lined up.”

Bangladesh issued a new tender to purchase 50,000 tonnes of rice closing on Dec. 28, while another tender for a similar volume is due to open on Dec. 22.

The country planned to import about 300,000 tonnes of rice.

Reuters

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