April 24, 2009

Thai rice export prices are likely to keep falling in the near term on news that the government is planning to sell 3.8 million metric tonnes of the grain from its stocks.

Prices have already been falling since mid-March as export demand slowed, according to data provided by the Thai Rice Exporters Association.

Thai 100% grade B white rice is at US$583/tonne, free-on-board Bangkok, compared with US$639/tonne March 18, the earliest date for which the association provided price data.

Parboiled rice has fallen to US$583/tonne from US$669/tonne March 18.

The Nation, a Thai daily, has reported the government will open bidding for 3.8 million tonnes of rice as the government wants to recoup some of its expenses after buying from Thai farmers at higher-than-market prices, worried that international prices could take a sharp hit if India begins rice exports later this year.

India has suspended white rice exports since 2008, but with overflowing granaries, the country's new government, likely to be sworn in by early June, could take steps to reduce stocks by allowing exports.

Bangladesh's rice imports have fallen by two-thirds in the first nine months of its fiscal year that began July 1, the country's Daily Star newspaper reported.

The paper said that higher local production has pushed imports down to 626,000 tonnes from 1.95 million tonnes.

In reported grains deals this week, Japan's Ministry of Agriculture kicked off its wheat buying program for the fiscal year that began April 1 by buying 148,000 tonnes wheat from the U.S., Canada and Australia in a tender concluded Thursday.