African port congestion weighs on Indian white rice demand

Congestion at African ports has impacted fresh demand for Indian non-basmati white rice, as price-sensitive buyers have become cautious amid higher freight costs and longer wait times, exporters and traders said June 26.

"Yes, congestion at several African ports and the resulting increase in container freight are affecting demand for WR to some extent. Buyers are becoming cautious due to higher landed costs and uncertainty in vessel schedules. However, demand remains present, with buyers becoming more price-sensitive and selective," a Gujarat-based exporter said.

African ports are experiencing operational challenges due to seasonal tidal restrictions and backlogs caused by recent adverse weather conditions.

Market sources reported an increase in rates from West Coast India to Africa amid congestion at both the origin and the destination.

Forwarders and shippers have reported delays at Nhava Sheva and Mundra, owing to an influx of containers from the Middle East choking yards, along with fuel-related shortages, especially at Mundra.

According to Kuehne Nagel's port update, the 7-day average vessel waiting time has increased at key African ports. Conakry, Beira, Port Elizabeth, and Banjul remained the most impacted.

"Persistent congestion at terminals and extended vessel queues continue to pressure operations, exacerbated by empty container imbalances and high yard utilization," according to the Kuehne Nagel update on June 23 for Mombasa.

"Customs clearance delays are further constraining throughput, while truck shortages, road disruptions and flood‑damaged infrastructure along key corridors are significantly impacting inland cargo flows."

Similarly, in Conakry, the 7-day average vessel waiting time was reported at 16.2 days amid limited storage capacity and insufficient empty containers.

Furthermore, a rice exporter based in Uttarakhand, India, said they have not been able to ship cargo to Beira amid container unavailability.

According to S&P Global Commodities at Sea, 19 vessels were at anchor in Beira, which fluctuated between 16 and 20 through June.

While delays at Dar es Salaam are about 3.25 days, congestion at the terminal persists amid increasing cargo volumes driven by diversions from Mombasa and Horn routes, adding pressure on the terminals, the report said.

Weather challenges have also exacerbated conditions at the ports, disrupting operations.

"Coega is experiencing operational challenges due to seasonal tidal restrictions and backlogs resulting from recent adverse weather conditions, impacting terminal productivity and cargo flows," the Kuehne Nagel port update said.

Rice exports at risk

"Until the port situation improves, the rice business is risky. A lot of financial loss for exporters who booked at lower rates, and don't get container bookings at the time of shipment," a Mumbai-based exporter said, while also adding that currently, Indian ports such as JNPT and Mundra are choked.

"Congestion in Conakry and Cameroon due to rainy season, these are the main ports India is exporting. Indian container freight is not supporting African destinations presently," a Delhi-based trader said.

The sources added that containers are reaching their destination ports after 4-5 months, and exporters who signed CNF contracts are now tied up due to rising freight rates.

"One of the buyers asked for prices in FOB, but stopped responding after seeing high prices," the Delhi-based trader said, while also adding that African demand for Indian WR is weak currently, which is why the buyers are likely to purchase more Parboiled 5%.

Platts, part of S&P Global Energy, assessed Indian 5% WR at $350/mt FOB on June 25, up $24/mt from a month ago, but still below other origins and at a discount of $133/mt to Thailand, $59/mt to Vietnam and $63/mt to Pakistan.