(VAN) West African parboiled rice prices have fallen 25% over the past six months following India’s removal of a 10% duty on exports.
Platts, part of S&P Global Commodity Insights, assessed the price of PB 5% STX CFR Cotonou at $450/mt on March 31, down from $600/mt on Sept. 27.
India reduced the export duty on parboiled rice to 10% from 20% on Sept. 27, 2024, before scrapping the duty on Oct. 22 to enhance the country’s rice export potential.
“Prices dropped significantly last September, leading to overbooking of cargoes,” an importer said.
India exported about 2.11 million mt of PB 5% broken to West Africa from September to December 2024, surging from 720,000 mt during the same period a year earlier, according to the Agricultural and Processed Food Products Export Development Authority. India’s full-year exports to West Africa rose to 5.35 million mt in 2024, from 3.9 million mt in 2023.
Market participants said demand has stagnated due to excess cargo arrivals since the removal of the duty, with many participants purchasing their last cargo in January in the wake of full warehouses.
Demand remains low even as freight rates for container and bulk vessels have fallen over the past two months. Bulk freight from Kakinada to Cotonou declined to $45-$50/mt from $65/mt, and container freight weakened from $100/mt in January 14 to $55-$60/mt on March 28. An Indian exporter said, “This reduction can be attributed to lower demand from the destination, so there are a lot of ships available, less demand, so less price.”
Nigeria, the most populous country in Africa, has a Muslim population of 47%, primarily concentrated in the northern region. A Benin importer said that “rice is not the main staple in northern Nigeria, where most Muslims live; they prefer corn, yam, and other staples over rice. In contrast, rice is more popular in the southwest and southeast, leading to limited demand from Nigeria for Ramadan.”
Market participants anticipate further potential declines in West African parboiled CFR prices in the second quarter of 2025 due to weak demand.
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