Bangladesh has offered over $40 a tonne more to Indian cooperatives to import 2.5 lakh tonnes of parboiled rice in a government-to-government deal compared with prices quoted by the private trade in a global import tender. The import deal will be through NCCF (National Cooperative Consumers Federation) and Kendriya Bhandar in two tranches with Dhaka getting rice at $443 and $443.5 a tonne each, trade sources said.
On Wednesday (December 21), India’s Bagadiya Brothers came up with the most competitive offer in the 50,000 tonnes parboiled import tender at $393.90 a tonne. “It is a boon for the cooperative movement as they will stand to gain ₹33 crore in each deal. Cooperatives have been able to fetch a better deal compared to private traders,” a trader told businessline on the condition of anonymity.
Last year, Bangladesh was able to get rice at a lower price from India as private traders tried to outbid one another. Then, private traders were settling even for margins as low as $1 a tonne.
Despite paying a higher price to Indian cooperatives for the G2G deal, Bangladesh will be getting parboiled rice at least $25 lower than the rated quoted Thailand or Pakistan. Currently, Thailand is quoting $486 a tonne for parboiled rice, while Pakistan is offering at $453-457.
A trade analyst said if Bangladesh is offering a 10 per cent higher price for the G2G deal compared to what private traders offered in the global tender, it means supply is tight in the global market.
Currently, demand in Asia for rice has increased with China, Bangladesh, Indonesia and the Philippines scouring for supplies. “Vietnam and Cambodia are silently gobbling up rice stocks in Myanmar. Bangladesh and Myanmar are at loggerheads over the Rohingyas issue,” the analyst said.
The Sheikha Hasina Wazed government is willing to pay the additional amount as it has drawn a blank in getting parboiled rice from either Vietnam or Thailand or Cambodia. A Bangladesh trade delegation visited the three countries last month but it yielded no result. Last week, another Bangladesh team visited Vietnam but the visit was not successful.
The rice market has been surging over the past couple of months, particularly after India imposed curbs on the cereal’s export. It banned exports of fully broken rice and imposed a 20 per cent export duty on white rice as its kharif paddy cultivation was affected by deficient rains in key producing areas of West Bengal, Bihar, eastern Uttar Pradesh, Jharkhand and Odisha.
Over the past couple of weeks, Thailand has hiked its rice prices by over 25 a tonne with parboiled rates being hiked by $33.
The Agriculture Ministry in its first advance estimate has pegged rice kharif production at 104.99 million tonnes (mt) against 111.76 mt last year. Bangladesh’s paddy crop, on the other hand, has been hit by floods followed by deficient rains.
The Food and Agriculture Organisation’s Agriculture Market Information System has projected rice production this year to be lower by over 12 million tonnes. However, trade sources say it could be further lower since the Chinese figures cannot be relied upon. “China has been buying a good volume of rice from the global market. It means there are problems in rice production there due to the 79 days dry period from July,” the analyst said.
According to the Agricultural and Processed Food Export Development Authority (APEDA), China is the top rice importer of Indian rice in the first half of the current fiscal. Beijing has imported 1.32 million tonnes (mt) of rice compared with 1.63 mt during the entire 2021-22 fiscal.
APEDA data show non-basmati rice exports in the first half of the current fiscal increased to 8.96 mt valued at $3.03 billion against 8.23 mt valued at $2.97 billion a year ago.