HANOI, June 15 Rice prices in India and Thailand stood steady this week ahead of a major auction in Thailand, while the export quotations softened slightly in Vietnam as buyers were absent, traders said on Wednesday.
Rice prices have eased from multi-month highs hit in May as drought brought by El Nino cut output in Asia's top growers.
India, Thailand and Vietnam, the world's biggest exporters, shipped a combined 66 percent of global rice trade in 2015, according to U.N. Food and Agriculture Organization data.
India's 5 percent broken parboiled rice prices were steady at $382-$392 per tonne, free-on-board (FOB) basis, this week as demand was softening ahead of Thailand's auction, traders said.
"Demand has fallen as some buyers are trying to secure rice at lower price from the auction," B.V. Krishna Rao, managing director at Pattabhi Agro Foods
Pvt Ltd, India's leading non-basmati rice exporter, told Reuters.
Thai government aims to sell 2.24 million tonnes at a rice auction on Wednesday.
India's domestic prices have been rising due to dwindling supplies and after the government raised the minimum purchase price by 4 percent, Rao said.
India mainly ships non-basmati rice to African countries and premier basmati rice to the Middle East.
In Thailand the 5 percent broken rice RI-THBKN5-P1 were almost steady at $418-$439 a tonne, FOB Bangkok, against $418-$437 last Wednesday, mainly due to low supply and thin demand, traders said.
Drought has damaged 1.82 million tonnes of rice in Thailand since October 2015, according to agriculture ministry's data.
Another trader said a possible depreciation of the Thai baht could allow lower prices.
"The weakening of the baht will earn us more money, so we could afford to lower our dollar prices," he said.
Kasikornbank forecast on Wednesday the baht could drop to 37 per dollar by the year end, or 2.8 percent down from the end of 2015.
In Vietnam, export quotations weakened on thin buying demand, even though China -- the top buyer of Vietnamese rice -- has returned after a while, seeking small quantity, traders said.
The 5 percent broken rice, using winter-spring grain, widened to $370-$375 a tonne, FOB Saigon, from $375 last week, while the same grade with summer-autumn grain dipped to $360-$365 a tonne, from $365 last Wednesday.
"China is back this week, asking for the 100 percent broken rice in small volumes, but no deals have been heard," a Vietnamese exporter in Ho Chi Minh City said.
Reporting by Ho Binh Minh, Reuters