HANOI, Vietnam - Asian rice trading is yet to pick up this week with market participants just trickling back after year-end holidays, while buying demand could emerge next month when a major crop harvest begins in Vietnam, traders said on Wednesday.
"It's quite a sluggish market today because it's the first day that we are back after New Year holiday and many rice mills are still away," a trader in Bangkok said.
The benchmark 100 percent B grade Thai white rice declined to $570 per ton, from last week's range of $570-$580. The 5-percent broken grade white rice advanced to $570 a ton this week from $560 last week.
Buyers have also been absent in Vietnam, where loading for small deals to the Philippines and China were under way, traders said.
"Several private firms were buying for the Philippines but their purchase, plus loading to China, did not leave any impact on the market," a trader in Ho Chi Minh City said.
Demand has yet to emerge from Africa, one of the key buyers of Vietnamese rice after Asia, he said.
Vietnam's 5 percent broken rice stood unchanged at $415-$420 a ton, free-on-board (FOB) basis, while the 25-percent broken grain edged up to $390-$395 a ton, from $370-$375 a week ago.
"Prices of the 25 percent broken grain rose because of low supply of low-grade rice to process this variety, while there is no actual demand," the Ho Chi Minh City-based trader said.
Last week Vietnam introduced a floor of $370 a ton for low-quality 35-percent broken rice for export.
Traders said the floor price has been imposed to prevent an expected fall in prices when Mekong Delta farmers begin harvesting the winter-spring crop from late next month.
The crop is Vietnam's biggest among its three rice crops grown each year in the Delta, the food basket.
Trading is expected to pick up from next week or later this month as companies assess the winter-spring crop production in the Mekong Delta, traders said.
Final data of Vietnam's rice export were not immediately available, while the government's statistics agency has estimated the annual shipment to reach an all-time high of 8.05 million tons.
Showing posts with label asia. Show all posts
Showing posts with label asia. Show all posts
Thursday, 3 January 2013
USDA Rice Outlook: Why Southeast Asia has a Rice Surplus and Why it Will Not Go Away
Southeast Asia is the leading source of world rice exports. Production growth in the region has slowed over the last decade. However, weaker consumption growth has allowed for export of a growing surplus. Rice markets favor varieties with relatively low yields but high consumer acceptance. Projections to 2021 foresee continued large exports from Southeast Asia, as regional exporters, including Thailand and Vietnam, are expected to produce enough rice to satisfy the import needs of Indonesia, the Philippines, and Malaysia, while continuing to serve large import markets outside the region.
Southeast Asia’s rice surplus remains a bright spot amid concerns about global food availability. Net rice exports from Southeast Asia, over 12 million tons in 2011, represent about half the import needs of the rest of the world. The rice surplus flowing out of the region has increased over the past 30 years, and USDA projections (2012) anticipate that this trend will continue over the next decade. Southeast Asian rice exports help underpin the world rice market, and changes in the rice surplus would affect world and U.S. prices. This report examines why Southeast Asia’s rice surplus exists and why it likely will continue.
In USDA’s most recent projections, Southeast Asia’s rice production and consumption are projected to grow at a slower rate over the next decade than in the previous decade. The projected slowdown in the rate of production growth is raising food security concerns because of projected slower production growth of food grains globally. In the case of rice in Southeast Asia, however, it is necessary to look at production changes in the context of consumption. In Southeast Asia, slowing production growth does not appear to threaten regional food security because consumption growth is also slowing. Projected production growth in the region is suffi cient to export a large rice surplus annually (10-12 million metric tons, or mmt) to the rest of the world, helping to meet global food needs.
Southeast Asia’s rice surplus remains a bright spot amid concerns about global food availability. Net rice exports from Southeast Asia, over 12 million tons in 2011, represent about half the import needs of the rest of the world. The rice surplus flowing out of the region has increased over the past 30 years, and USDA projections (2012) anticipate that this trend will continue over the next decade. Southeast Asian rice exports help underpin the world rice market, and changes in the rice surplus would affect world and U.S. prices. This report examines why Southeast Asia’s rice surplus exists and why it likely will continue.
In USDA’s most recent projections, Southeast Asia’s rice production and consumption are projected to grow at a slower rate over the next decade than in the previous decade. The projected slowdown in the rate of production growth is raising food security concerns because of projected slower production growth of food grains globally. In the case of rice in Southeast Asia, however, it is necessary to look at production changes in the context of consumption. In Southeast Asia, slowing production growth does not appear to threaten regional food security because consumption growth is also slowing. Projected production growth in the region is suffi cient to export a large rice surplus annually (10-12 million metric tons, or mmt) to the rest of the world, helping to meet global food needs.
Friday, 5 February 2010
Is The World Set for Another Rice Crisis?
"This year, I will not have enough rice to eat for the whole year," says Kong Chanthorn, a rice farmer in Srayov Kharng Tbong village in Cambodia's Kompong Thom province. "I am afraid I cannot earn the money to buy rice to support my families because this year its price is too high."
Chanthorn is not alone. The global price of rice, a staple for half the world's population, is rising inexorably again, up more than 25 percent in recent months, stoked by Philippine and Indian import demand although not to the stratospheric levels of late 2007 and early 2008. At that time the price rose from about US$300 per metric ton to as much as US$1,100. Prices later fell back to about US$400 as government panic subsided across the region and bans on export were lifted, and as planting pushed up stocks.
Cambodia's rising prices were precipitated by the onset last September of Typhoon Ketsana. On Wednesday Pov Samy, the secretary general of Cambodia's National Committee for Disaster Management, said Ketsana had caused flooding in eight of the country's 24 provinces and damaged public and private buildings to the tune of US$153 million. A further US$131 million is needed to restore the buildings' hardware, he said.
But the cost to rice farmers suffering lower production yields and higher food prices remains unknown, not only in Cambodia but in other areas of Asia as well. The damage from the typhoon, plus the potential of falling stocks from a recurrence of the El Nino weather phenomenon, raises the risk of skyrocketing prices.
Chanthon, 33, says he lost half the annual yield from his rice paddy from Ketsana. And although villagers in his area have received seeds and food help from non-governmental organizations, they have not been enough. "Some villagers have to catch fish to earn some money to buy milled rice," he said. "My daughter's rice field is all gone and my son-in-law has had to fish."
"Flooding from Ketsana has pushed the price of rice up in our community," Chanthorn. "Last year during the same period rice only cost 9000 riel [$1.75] for a basket. Now the price is near 13,000 riel [$2.10]."
Food security has become a major political issue in Asia in recent years due to imbalances in the demand-supply chain and hoarding by national governments. In response to the problems, the World Food Program has initiated a number of emergency projects, and the International Rice Research Institute (IRRI) last month launched a US$300 million fund-raising campaign for the region.
"Rice is fundamental not just to Asian economies but also Asian culture," IRRI Director General Dr Robert Zeigler said in a statement at the launch of the fund. "There is no doubt that rice research can help. For four decades, rice production has steadily increased in Asia, pushed ahead by new varieties developed through research that has helped ensure enough rice for all Asians.
"What we need more than anything is to make the necessary investments, especially with the looming threat of climate change," he added. "After all, in Asia, rice is life."
New statistics released by HSBC show that rice production could fall 20 percent this season due to a rage of mainly weather-related factors such as typhoons, flooding and droughts. As a result, global rice prices have surged to US$610 per metric ton. Along with the anticipated return of El Nino in 2010, the drop in yield could spell trouble for a region increasingly important to world economic growth although there is some debate over stocks.
Typhoon Ondoy, as Ketsana was known in the Philippines, severely damaged Filipino rice production, resulting in record buys of 202 million tons to build adequate stockpiles for 2010. Reuters reported on Jan. 13 that Philippines unmilled rice output is expected to hit a record this year, however, and that the El Nino effect expected to be mild. Bloomberg, however, quoted Philippine Agriculture Undersecretary Emmanuel Paras as saying as much as 20 to 20 percent of the country's rice growing regions could be affected by the weather phenomenon.
Some 1.5 million people affected by food shortages are beneficiaries of a $56 million WFP project in the Philippines. Running through June 2010, the program will attempt to trigger recovery through agricultural projects and support. However, the Philippines program is facing a funding shortfall of $33 million. Further emergency donations are needed in Cambodia, where 25,000 households received 1,250 tons of rice for the month of September to avoid starvation, but have been left to fend for themselves since.
"Food assistance provided by [UN programs] during crises is aimed at saving lives and ensuring people do not exhaust their meager resources to survive the ordeal," said Mike Huggins, WFP spokesperson for Asia. "By supporting people during tough times, they are better able to recover their livelihoods and get back on their feet when conditions improve."
In his December report for HSBC, "What's Cooking with Rice?," economist Frederic Neumann noted that the US Department of Agriculture (USDA) forecasts that global rice production in 2010 will be below global demand for the first time in five years. At the same time, stocks among major exporters are running about 20 percent below normal, he said — adding that the numbers may even underestimate the problem.
In 2008, continually low stocks and steadily growing demand "set up the market for a price spike that ultimately became self-perpetuating," Neumann wrote. "In a major review of the episode, the USDA recently concluded that hoarding and emergency trade restrictions imposed by governments were the main driver for the run-up in rice prices."
None of these underlying agricultural problems have disappeared in the past year. Following its driest monsoon season for 37 years, the Indian government is expecting its summer-sown rice output to fall by some 18 percent, forcing it to become a net importer for the first time in nearly two decades in order to cope, the USDA said.
"Rising rice prices should generally be positive for rice farmers across the region as it raises their income," Neumann said in an email exchange. "However, lower income groups tend to be more negatively affected. In a sense, therefore, rising rice prices represent a redistribution of income."
After two devastating typhoons and some of the heaviest rains in almost 40 years, the Philippines is also suffering massive production shortages that are expected to increase the country's import demand by 25 percent. The government was forced to revise up its emergency operations budget to provide for an additional 44,628 metric tons of food aid and extend the emergency operations plan through June of 2010.
The problem of food security and pricing is expected to increase hoarding by individual countries that could put at risk the consumption driven economic recovery of the region. This would exacerbate an already precarious situation for developing countries weathering the global economic recession.
Chanthorn is not alone. The global price of rice, a staple for half the world's population, is rising inexorably again, up more than 25 percent in recent months, stoked by Philippine and Indian import demand although not to the stratospheric levels of late 2007 and early 2008. At that time the price rose from about US$300 per metric ton to as much as US$1,100. Prices later fell back to about US$400 as government panic subsided across the region and bans on export were lifted, and as planting pushed up stocks.
Cambodia's rising prices were precipitated by the onset last September of Typhoon Ketsana. On Wednesday Pov Samy, the secretary general of Cambodia's National Committee for Disaster Management, said Ketsana had caused flooding in eight of the country's 24 provinces and damaged public and private buildings to the tune of US$153 million. A further US$131 million is needed to restore the buildings' hardware, he said.
But the cost to rice farmers suffering lower production yields and higher food prices remains unknown, not only in Cambodia but in other areas of Asia as well. The damage from the typhoon, plus the potential of falling stocks from a recurrence of the El Nino weather phenomenon, raises the risk of skyrocketing prices.
Chanthon, 33, says he lost half the annual yield from his rice paddy from Ketsana. And although villagers in his area have received seeds and food help from non-governmental organizations, they have not been enough. "Some villagers have to catch fish to earn some money to buy milled rice," he said. "My daughter's rice field is all gone and my son-in-law has had to fish."
"Flooding from Ketsana has pushed the price of rice up in our community," Chanthorn. "Last year during the same period rice only cost 9000 riel [$1.75] for a basket. Now the price is near 13,000 riel [$2.10]."
Food security has become a major political issue in Asia in recent years due to imbalances in the demand-supply chain and hoarding by national governments. In response to the problems, the World Food Program has initiated a number of emergency projects, and the International Rice Research Institute (IRRI) last month launched a US$300 million fund-raising campaign for the region.
"Rice is fundamental not just to Asian economies but also Asian culture," IRRI Director General Dr Robert Zeigler said in a statement at the launch of the fund. "There is no doubt that rice research can help. For four decades, rice production has steadily increased in Asia, pushed ahead by new varieties developed through research that has helped ensure enough rice for all Asians.
"What we need more than anything is to make the necessary investments, especially with the looming threat of climate change," he added. "After all, in Asia, rice is life."
New statistics released by HSBC show that rice production could fall 20 percent this season due to a rage of mainly weather-related factors such as typhoons, flooding and droughts. As a result, global rice prices have surged to US$610 per metric ton. Along with the anticipated return of El Nino in 2010, the drop in yield could spell trouble for a region increasingly important to world economic growth although there is some debate over stocks.
Typhoon Ondoy, as Ketsana was known in the Philippines, severely damaged Filipino rice production, resulting in record buys of 202 million tons to build adequate stockpiles for 2010. Reuters reported on Jan. 13 that Philippines unmilled rice output is expected to hit a record this year, however, and that the El Nino effect expected to be mild. Bloomberg, however, quoted Philippine Agriculture Undersecretary Emmanuel Paras as saying as much as 20 to 20 percent of the country's rice growing regions could be affected by the weather phenomenon.
Some 1.5 million people affected by food shortages are beneficiaries of a $56 million WFP project in the Philippines. Running through June 2010, the program will attempt to trigger recovery through agricultural projects and support. However, the Philippines program is facing a funding shortfall of $33 million. Further emergency donations are needed in Cambodia, where 25,000 households received 1,250 tons of rice for the month of September to avoid starvation, but have been left to fend for themselves since.
"Food assistance provided by [UN programs] during crises is aimed at saving lives and ensuring people do not exhaust their meager resources to survive the ordeal," said Mike Huggins, WFP spokesperson for Asia. "By supporting people during tough times, they are better able to recover their livelihoods and get back on their feet when conditions improve."
In his December report for HSBC, "What's Cooking with Rice?," economist Frederic Neumann noted that the US Department of Agriculture (USDA) forecasts that global rice production in 2010 will be below global demand for the first time in five years. At the same time, stocks among major exporters are running about 20 percent below normal, he said — adding that the numbers may even underestimate the problem.
In 2008, continually low stocks and steadily growing demand "set up the market for a price spike that ultimately became self-perpetuating," Neumann wrote. "In a major review of the episode, the USDA recently concluded that hoarding and emergency trade restrictions imposed by governments were the main driver for the run-up in rice prices."
None of these underlying agricultural problems have disappeared in the past year. Following its driest monsoon season for 37 years, the Indian government is expecting its summer-sown rice output to fall by some 18 percent, forcing it to become a net importer for the first time in nearly two decades in order to cope, the USDA said.
"Rising rice prices should generally be positive for rice farmers across the region as it raises their income," Neumann said in an email exchange. "However, lower income groups tend to be more negatively affected. In a sense, therefore, rising rice prices represent a redistribution of income."
After two devastating typhoons and some of the heaviest rains in almost 40 years, the Philippines is also suffering massive production shortages that are expected to increase the country's import demand by 25 percent. The government was forced to revise up its emergency operations budget to provide for an additional 44,628 metric tons of food aid and extend the emergency operations plan through June of 2010.
The problem of food security and pricing is expected to increase hoarding by individual countries that could put at risk the consumption driven economic recovery of the region. This would exacerbate an already precarious situation for developing countries weathering the global economic recession.
Tuesday, 8 July 2008
Rice prices in Thailand
Below are reported prices for Thai rice for the past week.
Thai 100% grade B
02/07 $740-$840
03/07 $740-$839
04/07 $740-$839
08/07 $760-$840
Parboiled 100% sortexed
02/07 $790-$900
03/07 $790-$900
04/07 $790-$900
08/07 $790-$900
In vietnam, the prevailing price for 5% rice has been $750-$800.
All prices per Metric Ton, FOB port of loading.
Wednesday, 11 July 2007
Thailand, Vietnam discuss co-operation
Thailand and Vietnam, the world's two top rice exporters, yesterday began three days of talks on co-operation in the rice trade in hopes of ending a price war and increasing prices to farmers. The meeting followed an accord signed last year in which the two countries' rice trade groups agreed to meet more frequently to exchange information and expand investment in their countries.
Officials from Laos, Cambodia, and Burma have also joined their Thai and Vietnamese counterparts in the discussions in Halong Bay to collaborate to improve the image and quality of Southeast Asian rice. The five countries control about 45% of the global rice trade.
Participants would share ideas on market trends for the second half of the year and discuss non-tariff barriers imposed by buying countries, said Chookiat Ophaswongse, president of the Thai Rice Exporters Association, Chookiat Ophaswongse, president of the Thai Rice Exporters Association and head of Huay Chuan, one of Thailand's largest rice exporters, said many Thai
businessmen want to hear details from the Vietnam Food Association, which invited Thai operators to invest in warehouses and related facilities.
Some rice traders such as Thailand's CP Group expressed interest in the investments but were still uncertain about local regulations and incentives.
The meeting would also consider whether to accept Pakistan as a member. Thai exporters are concerned that Pakistan's different grain types and trade circumstances make it incompatible.
Meanwhile, Mr Chookiat has expressed concern over rising transport charges caused by a shortage of ships and a stronger baht. He said some ocean shippers required additional payments if exporters load more than 14 tonnes per container.
''Normally, we can load as many as 21 tonnes in a container but now shipowners are blaming us for such heavy weight and extra expense is the result.''
Mr Chookiat added that expenses have increased to about US$100 per tonne, from $50-60 a tonne, while the strong baht has made Thai rice be more expensive.
At a 34 baht per US dollar, the FOB (free on board) price of 100% B-Grade white rice this week was $341 a tonne, up from $338 quoted last week. Hom Mali fragrant rice rose to $579 from $574 per tonne.
The vessel shortage might deter the country's plan to ship a total of 8.5 million tonnes this year.
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