South Africans are seeing lower rice prices on supermarket shelves. Picture: Liesl Peyper/Moneyweb Global rice prices look unlikely to recover soon as oversupply continues to weigh on the market, dragging prices down from about $600 (R9 693) a tonne to around $350-$360 (R5 654). South African consumers are already seeing lower rice prices on supermarket shelves, with all major retailers currently offering rice on special as global prices ease.
South Africa imports 100% of its rice requirements – typically between 1.2 million and 1.3 million tonnes a year – with most of it sourced from Thailand, India, Pakistan and Vietnam, says André van der Vyver, executive director of the South African Cereals and Oilseeds Trade Association (Sacota). “Lower rice prices come after a period of synthetically higher prices, due to India’s decision to restrict rice exports ahead of its national elections,” he tells Moneyweb. “As one of the world’s largest exporters, India’s move constrained global supply and lifted prices across international markets.” Once the restrictions were lifted after the election, exports resumed into a market that had already responded by expanding production elsewhere, resulting in a swing to surplus.
According to Van der Vyver, good monsoon rains have further bolstered output and higher stock levels are expected to persist this year. This is illustrated in the price graph below, which shows rice prices peaking above $600 a tonne before declining steadily over the past 18 to 20 months. The graph highlights how quickly prices adjusted once export flows normalised.
Read Full Article on The Citizen
