Vietnam’s rice quality improves, as does its export price
Vietnam’s rice quality improves, as does its export price
The price of Vietnam’s rice exports is surging, fueled by growing world demand and improved quality and recognition.
Growing number of orders
The Trung An Hi-tech Farming Joint Stock Company in the Mekong Delta city of Can Tho is working hard to export 15,000 tonnes of broken rice to the Republic of Korea (RoK) from now until June. The RoK partner buys the rice (for beer production) at a FOB (free on board) price of US$369 per tonne, US$31 per tonne higher than the price listed by the Vietnam Food Association for products of the same kind.
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Many other Vietnamese businesses are strengthening rice exports to meet the growing demand for rice in the post-pandemic period. Ministry of Industry and Trade data show that rice exports experienced the highest first quarter growth in 2022, reaching 1.48 million tonnes of rice worth US$715 million, up 24 and 10.5 percent in volume and value compared with the same period last year.
The Vietnam Food Association’s data showed that Vietnam has become a leading rice exporter, with the price of its five-percent-broken-grain rice increasing US$12-15 per tonne compared to early this year and US$10 per tonne compared to early March, to reach US$415 per tonne in early April – the highest price of the past three months. Thai rice of the same kind is sold for US$408-412 per tonne.
The Ministry of Industry and Trade attributed Vietnam’s improved rice export value to the country’s transformation of its export rice structure to increase the proportion of high-quality rice. Vietnam has increased the cultivation of high-quality rice varieties meeting the standards of discerning markets, making its rice exports more competitive.
According to the Vietnam Trade Office in Sweden and the Nordic market, Europe is expected to import an estimated 1.8 million tonnes of de-husked rice and its rice imports will likely soar about 250,000 tonnes in the next decade.
In 2021, the Loc Troi Group, for example, exported 4,170 tonnes of high-quality rice to the EU under the improved terms of the EU-Vietnam Free Trade Agreement (EVFTA) and it expects its high-quality rice exports to the EU and Australia to increase.
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Branding development
The Ministry of Agriculture and Rural Development has approved a project for restructuring Vietnam's rice industry to 2025 and 2030, which will improve Vietnamese rice quality and value, form rice chains, develop climate-smart agriculture, improve rice farmers’ income and meet consumer demand for high-quality rice. Branding development will be an important part of the project, promising prices 10-20 percent higher than non-branded products of the same kind.
The Ministry of Industry and Trade will continue to help businesses access market information, promote exports, take advantage of FTAs, look for new markets, diversify markets and improve export rice value.
| In recent years, high-quality Vietnamese rice products, including ST24, ST25, and Jasmine, among others, have entered major discerning markets of the EU, helping increase the country’s rice export value. Vietnam’s rice exports to the EU are expected to reach at least 60,000 tonnes in 2022. |
