Rice prices hit 18-months peak as coronavirus strains export logistics

Rice export prices in top hub India rose to their highest in nearly 18 months this week as supplies remained constrained due to pandemic-induced disruptions, while Bangladesh may have to import the staple after natural calamities damaged crops.

India's five per cent broken parboiled rice prices <RI-INBKN5-P1> climbed to $387-$394 per tonne from last week's $384-$390.

With the top exporter now behind only the United States in the tally of Covid-19 cases, exporters have been grappling with limited availability of containers and mill workers at its biggest rice handling port of Kakinada on the east coast.

"Coronavirus outbreak has affected rice milling in Andhra Pradesh and loading operations at Kakinada. Limited supplies are available for exports though demand is robust," said a Kakinada-based exporter.

For latest updates and live news on coronavirus, click here

In neighboring Bangladesh, domestic prices have risen up to 20 per cent over a month amid fears of a production shortfall.

Excessive rainfall in March-April, cyclone Amphan in May and three spells of floods in June-July damaged most crops, of which 70 per cent was paddy, according to agricultural ministry officials.

Bangladesh needs to start importing rice without any delay, sources familiar with the matter said.

In Vietnam too, low domestic supplies pushed prices for five per cent broken rice <RI-VNBKN5-P1> to $490-$495 a tonne on Thursday from $490 last week.

"Domestic supplies are very low at the moment, while some exporters continue to fulfill their contracts signed earlier with customers from Malaysia, Timor-Leste and Africa," a trader in the Mekong Delta province of Tien Giang said.

Traders expect prices to come down in the coming weeks ahead of the autumn-winter harvest.

Adding to demand woes, another trader said the Philippines could suspend rice purchases at least until November to support domestic prices of an ongoing harvest there.

In Thailand, benchmark five per cent broken rice <RI-THBKN5-P1> prices eased to $487-510 per tonne on Thursday from $500-$513 last week amid muted demand.