Vietnamese and Thai rice prices increase sharply after India's rice export ban

Asian rice market

Prices of Vietnamese and Thai rice have now increased by nearly 20% in value since the ban on non-basmati white rice exports in July 2023. Thai 5% broken rice prices were quoted at $650-$655 a tonne, the highest since October 2008, compared with $627-$630 a tonne last week.

A Bangkok-based trader said new rice supplies were limited. Another trader said demand was rising from around the world , including Indonesia, Africa and the Philippines. “There may be more rice supplies, but millers may hold them back to sell later at higher prices,” he said.

Vietnam’s 5% broken rice was quoted at $620-$630 a tonne, the highest since July 2008, and up from $590-$600 a tonne last week. A trader in Ho Chi Minh City said trading was limited as exporters still expected prices to rise further. Another trader said exporters were not signing new export contracts as domestic rice prices were getting more expensive, making it difficult for them to secure enough supplies to meet contracts.

India's 5% broken parboiled rice was quoted at a record $460-$467 a tonne this week, up from $450-$455 last week on demand shifting to the grade following a ban on non-basmati rice.

Some people have bought rice at record prices, as Thai rice exporters are quoting even higher prices, an exporter said.

Meanwhile, a commerce ministry official said neighbouring Bangladesh is lifting a ban on aromatic rice exports due to good domestic stocks and a record crop.

US agricultural market

Agricultural commodity prices on the Chicago Board of Trade (CBOT) all fell on August 11, led by corn. Corn for December 2023 delivery fell 9 cents (1.81%) to $4.8725/bushel. Wheat for September 2023 delivery fell 11 cents (1.72%) to $6.2675/bushel. Soybean prices for November 2023 delivery fell 10.75 cents (0.82%) to $13.075/bushel (1 bushel of wheat/soybean = 27.2 kg; 1 bushel of corn = 25.4 kg).

The USDA August Crop Report and the World Agricultural Supply and Demand Estimates (WASDE) released on August 11 were both moderate to positive. The US corn production estimate was 175.1 bushels per acre (BPA) and soybeans were 50.9 BPA, both slightly lower than expected, leading to a decline in stocks for both crops in 2023-2024. Meanwhile, corn and soybean exports were also cut.

US corn production in 2023 is estimated at 15.111 billion bushels, down 210 million bushels from July 2023. US corn ending stocks in 2022-23 increased by 55 million bushels to 1.457 billion bushels due to a 50 million bushel decrease in exports to 1.625 billion bushels and a 5 million bushel increase in imports. US corn ending stocks in 2023-24 decreased by 60 million bushels to 2.202 billion bushels due to lower production and exports. US corn exports in 2023-24 are estimated at 2.050 billion bushels.

The WASDE report raised Brazil's 2022-23 corn production to 135 million tons, up 2 million tons. The estimated world corn stocks for 2023-24 are 311.1 million tons, up 13 million tons from last year. The EU's corn production is down 3.5 million tons, while Ukraine's corn harvest is up 2.5 million tons to 27.5 million tons. Brazil's 2024 corn harvest is forecast at 129 million tons.

U.S. 2023-24 soybean ending stocks are at 245 million bushels due to lower 2023 soybean production. U.S. 2022-23 soybean exports are down 5 million bushels to 1.980 billion bushels.

Meanwhile, Brazil's soybean output is forecast at 163 million tons in the 2023-2024 crop year.

U.S. wheat ending stocks for 2023-24 are forecast to increase by 23 million bushels to 615 million bushels as exports are down 25 million bushels to 700 million bushels, partially offsetting lower total production. U.S. wheat is becoming increasingly competitive at current prices amid rising global FOB prices.

Corn, wheat and soybeans are expected to post sustained lows over the next 30 days as global feed use recovers, forcing importers to source wheat supplies from outside the Black Sea region.

World coffee market

At the end of the weekend trading session, Robusta coffee prices on the ICE Europe - London exchange tended to move in opposite directions. Robusta coffee prices for September 2023 delivery increased by 6 USD, to 2,672 USD/ton, while futures all decreased.

Meanwhile, Arabica coffee prices on the ICE US - New York exchange extended their decline to the fourth session. Arabica coffee prices for September 2023 delivery fell another 2.10 cents to 157.80 cents/lb and Arabica coffee prices for December 2023 delivery fell 1.95 cents to 157.70 cents/lb. Trading volume remained very high above average (1 lb = 0.4535 kg).

The price of green coffee beans in the Central Highlands provinces (Vietnam) decreased by 200 - 300 VND, fluctuating in the range of 66,700 - 67,500 VND/kg.

Coffee prices continued their negative trend as new crop sales pressure from the world's largest coffee producer and exporter increased sharply, according to the July 2023 export report.

Cooxupé, the largest coffee cooperative in Brazil and the world, reports that its members have so far harvested more than 70% of their coffee growing areas and that the weather remains favorable, supporting the drying of coffee beans to achieve higher quality.

Consulting and analytics firm Safras & Mercados also reported that Brazilian farmers had sold 41% of their 2023-24 crop by early August 2023, slightly lower than around 45% a year earlier and below the historical average of 46% for the season.

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