Rice market stagnates in first five months

Vietnam’s rice shipments in the five months leading up to June dipped 10% in volume year-on-year to 2.1 million tonnes valued at US$870 million, according to the Vietnam Food Association (VFA).

Photo for Illustration (Photo: Thai Thien).

Meanwhile, Vietnam exporters have signed contracts to sell 3.2 million tonnes of rice so far this year a decline of 8% compared to last year’s comparable period, the VFA said.

The VFA said the reasons for the drop included thin demand and exporters’ limited access to credit financing.

The world rice market also presented a number of challenges due to low demand and high supply from Thailand, India, Pakistan and Myanmar.

According to the VFA, rice exports will continue facing difficulties as African countries opt to purchase large quantities of rice being offloaded onto the market by Thailand.

Meanwhile, Vietnam’s key markets such as China and Southeast Asia have lowered their demand.

Vo Thanh Do, deputy head of the Agro-Forestry, Seafood Processing and Salt Industry Department under the Ministry of Agriculture and Rural Development said in the Mekong Delta, the price of rice stands at between VND4.150 and VND4.250 per kilo.

To cope with the situation, the VFA has proposed purchasing rice in the summer-autumn crop to ensure profits for farmers. Compared to the average price of VND4.091 per kilo in May, farmers make a 30% profit, Do said.

In the first five months of the year, China accounted for a 35% share of the export market. However, from the middle of last year until now, China has tightened the import of rice through border gates with Vietnam, leading to difficulties in rice exports.

Nguyen Thi Bich Vuong, director of Hung Thinh Import-Export Co, Ltd said in the first three months of the year, her company exported several shipments of rice. However, since the beginning of April, the company has not shipped any rice to China.

Meanwhile, Vietnamese rice is mainly exported to traditional markets such as the Philippines, Malaysia, Indonesia, and China.

Nguyen Van Nam, a representative from the Ministry of Industry and Trade said to export rice at good prices, growers should improve the quality of rice, and grow high-yield rice while businesses should get rid of the lower quality varieties.

Businesses should make market surveys and co-ordinate with farmers to increase the price, said Nam.

According to the VFA, China is expected to import 4 million tonnes of rice this year.

In addition, ASEAN nations also have demand for importing more than 4 million tonnes, which has opened up a bright spot on the horizon for rice exports.

(Source; VOV)