By Apornrath Phoonphongphiphat
BANGKOK - Demand for low-quality white rice from African buyers has forced Thai exporters to purchase additional stocks from Cambodia and Vietnam to meet orders because domestic rice is in short supply due to a government buying scheme, traders said on Wednesday.
The price of 25 per cent broken grade Thai white rice jumped to $545 per tonne on Wednesday, some way above the $520-$530 per tonne being offered recently, although the benchmark 100 per cent B grade was steady at $580, they said.
The government has extended its intervention scheme, paying farmers 15,000 baht ($480) per tonne for paddy, to end-September and is expected to renew it again in October, when harvesting of the main crop is due to start.
The scheme has pushed government rice stocks up to a record high of 17 million tonnes of paddy, or around 10 million tonnes of milled rice - what Thailand exports in normal years.
Due to a lack of broken grade rice on the market, some Thai exporters have had to import some from Cambodia, or even from Vietnam via Cambodia.
"There was some rice coming from neighbouring countries, but some of it was smuggled so there's no record of how much has been brought in," said one Thai exporter.
VIETNAMESE PRICES RISE Demand from Thai exporters and hopes for possible orders from countries affected by recent adverse weather helped support Vietnamese prices, traders said.
A drought affecting US corn, low monsoon rain in India and floods in China and the Philippines have pushed up the price of ingredients for feed production, dragging up rice prices, a trader in Ho Chi Minh City said.
"Exporters and trading firms all have started buying, so prices have gone up quickly," he said.
The 5 per cent broken rice rose to $425-$430 a tonne on Wednesday, free on board Saigon Port, from last week's $415-$420. The 25 per cent broken rice jumped to $395-$405 a tonne from $375-$380.
"Given the bad weather, India may consider limiting its grain exports and that talk has also fuelled the price gain,"the Ho Chi Minh City trader said. Harvesting of the Mekong Delta's summer-autumn crop has peaked and will end later this month, meaning no fresh grain supply to weigh on prices in coming weeks.