Domestic rice exports continue to rise

Domestic rice exports continue to rise

Viet Nam targets exporting 2.2 million tonnes of rice in the second quarter of the year, which would raise the total export volume for the first six months to 3.65 million tonnes, according to the Viet Nam Food Association.

Speaking at a meeting in HCM City yesterday, Huynh Minh Hue, VFA general secretary, said that businesses had exported 1.45 million tonnes of rice for a free-on-board (FOB) value of US$641.3 million in the first quarter of the year.

This represented an increase of 35.12 per cent in volume and 22.76 per cent in value compared to the same period last year.

With an abundant supply in the world market, the average export price in the period was $44.5 per tonne lower than from the corresponding period last year, to around $442 per tonne, he said.

Countries in Asia and Africa were the main buyers of Vietnamese rice, accounting for nearly 66.3 per cent and 16.4 per cent of total export volume, respectively, he said.

During this period, exports of high-grade and fragrant rice accounted for nearly half of total exports, and average-grade rice 31.7 per cent, he said.

By the end of last month, enterprises had signed contracts to export 3.57 million tonnes of rice and had already shipped 1.45 million tonnes.

This means that another 2.12 million tonnes will be delivered beginning in April.

Hue as well as other meeting attendees said that world rice prices were not likely to increase in the coming months because supply was abundant.

Thailand and India, two of the world's largest exporters, have a large inventory, so they will seek ways to reduce their stocks, thus putting more pressure on rice prices.

However, Le Viet Hai, director of the Mekong-Can Tho Joint Stock Company, said there was no sense of urgency for Viet Nam to cut export prices further "since our price was already low, and our rice is fresh and has a consistent quality."

Truong Thanh Phong, VFA chairman, agreed, saying the association would adjust selling prices in a flexible manner.

Asian and African countries will continue to be the main import markets of Vietnamese rice, he added.

However, low-grade rice will have a difficult time entering African market since low-grade Vietnamese rice cannot compete with rice from India and Pakistan, Phong said.

He said "demand from traditional markets for Vietnamese rice is expected to improve in the second quarter."

In addition, Viet Nam has recently signed a memorandum of understanding with the Republic of Guinea to export 300,000 tonnes of rice annually to the African nation until the end of 2015, he said.

Phong said "I believed that the industry would meet its export target set for the second quarter."

He asked enterprises to keep a close eye on changes in the world rice market and outline appropriate export plans.

Enterprise representatives at the meeting asked the association to work with agencies to strengthen quality control of fragrant rice so that its reputation on the world market would be maintained.

As for the national programme to stockpile one million tonnes of rice, he said enterprises had completed purchases as scheduled. The programme has helped to both stabilise the price of rice and ensure a profit for farmers.

"From now until May, rice prices in the domestic market are not expected to fluctuate," Phong said.

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