BANGKOK (Commodity Online) : Prices for Asian rice in international markets dropped further at the start of this week despite the fact that domestic rice prices are climbing in many countries in the region.

According to analysts lack of foreign demand remained the main cause for the price dip.

World’s largest rice exporter Thailand’s benchmark 100 per cent B grade white rice was offered at $480 per tone Wednesday, free on board, down from last week's $490.

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In Vietnam, the second-biggest exporter, exporters lowered their offers this week in a bid to attract buyers but business remained sluggish.

Its five per cent broken rice eased to $450-$460 a tone, free on board, Wednesday, down from $470-$475 last week. The 25 per cent broken rice softened to $410-$435 a tone from $435-$440.

Analysts added that buyers aren’t attracted even at this rate and key buyers in Africa are waiting for further drops in prices to buy.

The recent firmer trend in Vietnam was not supported by demand but was simply the result of an increase in export floor prices set by the Vietnam Food Association (VFA).

The VFA raised the floor price for the five per cent broken grade to $450 per tonne from $430 on Aug 28. The floor for 25 per cent broken rice was lifted to $410 a tonne from $390.

The rise in Vietnamese prices had pushed Thai prices up, although traders had been sceptical that would last.

Better demand in domestic markets in both Thailand and Vietnam, especially to meet deals done during August, had pushed local prices up, adding to the problems of exporters as they tried to get grain for delivery.

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