Wires

Asia Rice-Thai export rates strengthen; Indian prices at four-month peak

Harshith Aranya

* Thailand could lose place as second-biggest rice exporter

* 2020 Thai rice export target lowest in seven years

* India rates rise on higher African demand

* Coronavirus epidemic dents Vietnamese sales

BENGALURU, Feb 13 (Reuters) - Local currency fluctuations helped to increase the top end of the range for Thai rice export prices this week while prices for leading exporter India rose to a more than four-month peak.

The range for Thai benchmark 5% broken rice <RI-THBKN5-P1> widened on Thursday to $425-$447 a tonne from $425-$439 the previous week.

"The baht has softened, but rice prices remain expensive and this has deterred buyers," one Bangkok-based trader said.

A strong baht resulted in 32.5% drop in rice exports in 2019, the Thai Rice Exporters Association said this week.

The currency, however, has weakened of late and touched a more than seven-month low against the U.S. dollar on Feb. 7, mainly hurt by the coronavirus outbreak in China.

Traders said the prices of Thai varieties remain higher than competitors because of the drought that has hit many rice-growing regions and curbed production.

"There is a bullish feeling in the market that prices will stay high and may even go up further," another Bangkok trader said.

The exporters association set an export target of 7.5 million tonnes for 2020, the lowest in seven years, and noted that Thailand could lose its place as the world's second-biggest rice exporter.

Meanwhile, prices for India's 5% broken parboiled variety <RI-INBKN5-P1> rose to their highest since late September at $371-$376 a tonne, up from $370-$375 quoted last week.

"Demand has been trickling in from African countries," said an exporter based at Kakinada in the southern state of Andhra Pradesh.

In Vietnam, rates for 5% broken rice <RI-VNBKN5-P1> stayed flat from a week earlier at $355-$360, with the coronavirus epidemic weighing on sales.

"Many of our clients have cancelled their trips to Vietnam to check out the rice," said a trader based in Ho Chi Minh City.

The winter-spring harvest, meanwhile, is peaking and will finish by the end of this month, traders said.

Customs data released this week showed Vietnam's rice exports in January fell 4.6% from a year earlier to 410,855 tonnes.

Concern over the shrinking area for rice production because of salinity keeps the prices from falling, traders said.

Meanwhile, Bangladesh's rice output in the year to June hit a record high of 37.2 million tonnes, according to preliminary estimate from its statistics bureau.

"Our efforts are paying off," Agriculture Minister Abdur Razzak told Reuters on Thursday, adding that the government was providing subsidies to buy modern equipment to boost production and minimise costs. (Reporting by Rajendra Jadhav in Mumbai, Ruma Paul in Dhaka, Khanh Vu in Hanoi and Panu Wongcha-um in Bangkok Additional reporting by Swati Verma in Bengaluru Editing by David Goodman)