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Bangladesh says India to sell it 0.3m tonnes rice (below international prices)

why??
India needs to feed it's own citizens, but since government isn't interested in that, they should proceed with it anyways.
 
Since we are talking rice, looks like Bangladesh is increasing its rice import to 1.2 million tonnes this year, and a quarter of it is going from India at a cheaper rate. Should make a lot of difference for the poor households. :cheers:

Rice Imports by Bangladesh to Double on

Rice Imports by Bangladesh to Double on ‘Panic-Buying’
By Luzi Ann Javier - Jan 26, 2011
Bangladesh, South Asia’s biggest rice buyer, doubled its import target for this year to cool domestic prices that surged to a record in December as consumers and farmers hoarded supplies, a government official said.

The import target was raised to 1.2 million metric tons for the year ending June 30, from 600,000 tons set in November, said Badrul Hasan, director for procurement at the nation’s Directorate General of Food. That’s triple the U.S. Department of Agriculture’s estimate of 400,000 tons.

“The reason for the increase is panic-buying,” Hasan said in a phone interview from Dhaka yesterday. “There’s a sense of insecurity among the public. People who usually need 10 kilos buy more than 20 kilos. When farmers need to sell, they withhold their stocks” expecting a windfall as prices advance, he said.

Rising imports by Bangladesh may help push world prices higher, with global demand forecast by the USDA to exceed production for the first time in four years and as soaring costs of other staples like wheat fuel social unrest. Rough-rice futures in Chicago surged to a record in 2008 as hoarding by consumers prompted governments including the Philippines to boost imports, while exporters such as India and Vietnam restricted shipments.

“Governments are now playing in the market, as they did three years ago,” said Jonathan Barratt, managing director at Sydney-based Commodity Broking Services Pty., who correctly predicted rice futures would advance to $15 last year. “That panic and their inability to understand how the market works will continue to be supportive” of prices, he said.

Price Index Record

The United Nations Food & Agriculture Organization’s Food Price Index surged to a record in December, driven by higher prices of cereals, sugar and oilseeds.

Increased purchases by Bangladesh may push global trade higher than USDA estimates. Trade was forecast to decline to 30.325 million tons, from 30.421 million last year, the agency said on Jan. 12, based on the assumption that Bangladesh would import 400,000 tons. Global trade is equal to 6.7 percent of world consumption, according to USDA data.

“I would expect speculators to ride on that,” Ker Chung Yang, an analyst at Phillip Futures Pte., said from Singapore. “Subsequently, prices would rise” in Chicago, he said.

Rough-rice for March delivery gained as much as 0.6 percent to $15.29 per 100 pounds today, extending yesterday’s 3 percent jump, and traded at $15.285 at 12:17 p.m. Singapore time. The price peaked at $25.07 in April 2008.

The retail price of coarse rice climbed to 34.93 taka (49 cents) a kilo in Dhaka last month, up 7.8 percent from November and 42 percent more than a year earlier, the FAO said in a report Jan. 17.

Expanding Demand

Global demand will expand 3.4 percent to 452.8 million tons this season, while production is estimated to rise 2.6 percent to 452.4 million tons, according to the USDA.

Bangladesh is in talks with India for a government-to- government contract to buy 300,000 tons of non-basmati rice, and an agreement may be signed in the next few days, Hasan said. State deals are exempt from India’s export ban, he said.

A further 350,000 tons will be shipped from Vietnam in February under a similar contract, he said.

The government has already purchased 400,000 tons of rice through public tenders and may buy the balance of the 1.2 million tons in the coming weeks, including 30,000 tons of parboiled rice set to be purchased in a Feb. 8 tender, he said.

To contact the reporter on this story: Luzi Ann Javier in Singapore at ljavier@bloomberg.net

To contact the editor responsible for this story: James Poole in Singapore at jpoole4@bloomberg.net
 

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