Benchmark Thai rice prices leapt more than 5% to a record high above $1,000 a ton Thursday. Meanwhile, Brazil has temporarily halted rice exports to ensure domestic supply amid rising world prices for the grain.
Brazil grows more rice than it consumes and has a reserve that will safeguard the country's supply, Agriculture Minister Reinhold Stephanes said in a statement. Sales abroad will nevertheless be blocked to make sure the country has enough of the grain for the next six to eight months.
Several Asian countries recently suspended rice exports to guarantee their own supplies, causing an imbalance in world markets, Stephanes said.
"Brazil is self-sufficient in rice production and there is a small amount that exceeds local demand, but in order to safeguard supply in the next six to eight months between harvests, exports are suspended," Stephanes said in a statement.
"We will follow the movement of the principal world producers," Stephanes said. "With the favorable price, it's possible that there will be an increase in production and that the supply situation will be resolved next year."
Brazil will not meet recent requests by African and Latin American countries for shipments totaling nearly 500,000 tons of rice, he said. Brazil currently has 1.6 million tons of rice in government warehouses.
Brazil follows on the steps of India and Vietnam, the world's second- and third-largest rice exporters in 2007, in imposing export curbs of rice in a bid to keep prices of the grain under control. Brazil, which is not a major global rice supplier, exported 313,000 tons of rice last year.
Thai Rice Climbs to New Record Above $1,000 A Ton
Separately, benchmark Thai rice prices leapt more than 5 percent to a record high above $1,000 a ton Thursday, and traders in the world's top exporter warned of further gains if buyers Iran and Indonesia step into the market.
Prices have now nearly trebled since around $383 in early January, sparking food riots in African countries and Haiti and adding to growing fears that millions of the world's poor may soon struggle to feed themselves.
Thailand's 100 percent B grade white rice, the world's main physical benchmark for global trade, was quoted in a range of $1,000 to $1,080 per ton free on board, up from around $950 per ton last week, according to a Reuters poll of five traders.
This year rice finally joined in a global rally in food crop prices amid a surge in demand from major importers who feared that export restrictions by key suppliers like Vietnam might leave them short, especially with global stocks having halved since touching a record high in 2001.
Some analysts say the sense of panic should subside as stocks rebuild and new crops reach the market, although sellers in Thailand remained bullish on the hope that other buyers like Iran and Indonesia would soon join Manila in topping up domestic stockpiles.
"Some exporters may quote a price higher than $1,000 a ton if their costs are higher. Supply is still tight," Chookiat Ophaswongse, head of the Exporters Association, told Reuters. "If the Philippines agrees to buy all of the rice offered at the tender last week, prices will go much higher," Chookiat said.
Iran and Indonesia, which traditionally each buy around 1 million tons of rice a year, have avoided Thai rice this year due to high prices. But traders said they may jump into the market soon. "If Iran buys rice from Thailand, Thai 100 percent B grade white rice would hit $1,300 a ton," one exporter said.