SINGAPORE (Dow Jones)--Asia's rice prices have mostly declined in the past few days as shipments of a few hundred thousand metric tons to the Ivory Coast have been diverted due to civil unrest in the African country.

Prices will likely be subdued next week due to sluggish demand, trade participants said.
Many traders were on the sidelines this week due to a national holiday in Thailand, but price offers are already lower and the weak sentiment may continue into next week, said a Singapore-based exporter.

The Ivory Coast is one of the world's largest rice importers, buying up to 1.2 million tons a year, of which up to 500,000 tons are then trans-shipped to Burkina Faso, Niger, and Mali.

A large part of this trade has now been diverted to Ghana, Sierra Leone and Togo, resulting in increased stockpiles there, while other parts of west Africa suffer from a shortfall and higher prices.

"We are seeing some decline in purchasing by west African buyers due to the diversion of cargoes [meant for Ivory Coast]," said Korbsook Iamsuri, president of Thai Rice Exporters Association.

Thailand, the world's largest rice exporter, is a major supplier to west Africa and its offers have declined below even those of Vietnam, a rare phenomenon.

Thai 5% brokens are currently offered around $470/ton, free on board for prompt shipment, down from $490/ton a week earlier. The price of 25% brokens has declined to $440/ton from $450-$460/ton, FOB.

Vietnam is offering 5% brokens around $470/ton, FOB and 25% brokens around $440/ton.
Low Thai prices will pull down Hanoi's offers too, said an exporter in Vietnam.

Vietnam's prices have been holding so far due to recent sales to the Philippines, but they will be difficult to sustain amid bumper harvests and a halt in purchases by Bangladesh and Indonesia, he added.

Sub-Saharan Africa's imports account for close to a third of the annual global rice trade, according to London-based International Grains Council's estimates.

African buyers are buying only in small lots and this is a reason behind the fall in prices, said Chookiat Ophaswongse, managing director of major Thai exporter Huay Chuan Rice Co.

Pakistan, another major exporter, is also feeling the pressure of demand slowdown.

African and Bangladeshi demand for Pakistan's parboiled rice is weak and prices have declined by $20-$25/ton so far this month, said Abdul Aziz Ghaffar, chief executive of RiceTex, a Karachi-based trading company.

Around March 24, Pakistan's 15% broken parboiled rice was offered at about $500/ton, FOB but the price has now slumped to around $460, he added.

However, white rice prices are holding steady; 25% brokens are being offered around $425/ton, FOB for prompt shipment.

Rice prices may have been fallen more but for the recent strengthening of Pakistan's rupee and the Thai baht against the greenback

Source: Dow Jones