HCM City (VNA) – Vietnamese rice exports are expected to revive inthe last quarter of the year following four months of stagnation, boosted by newpurchase demand in some markets.

Tough seas for Vietnamese rice

In the first eight months of the year, Vietnam earned 2.2 billion USD fromexporting 4.4 million tonnes of rice, a year-on-year surge of 22.1 percent invalue and 6.8 percent in volume.

Despite the robust growth in the period, rice exporters said that rice markethas been stagnant since the end of May as demand for Vietnamese rice declined insuch traditional markets as China, Indonesia and the Philippines during QuarterII and Quarter III.

Thai rice, which was sold at low price, really worried Vietnamese exporters.Not many rice consumption contracts were signed during the period as Vietnameserice became less competitive.

According to Nguyen Van Don, director of Viet Hung Co.,Ltd in Tien Giangprovince, rice was exported in dribs and drabs, with some 1,000 tonnes of ricesold per week. With this pace, his firm could not realise the set target for thewhole year.

Notably, China’s sudden imposition of a 50 percent tariff on rice imports fromJuly affected rice consumption in this market, especially sticky rice. At somepoint, Chinese traders paid only 380 USD per tonne for sticky rice as comparedto 530-540 USD per tonne at the beginning of the year.

Statistics from the Ministry of Agriculture and Rural Development showed thatalthough China remained the largest importer of Vietnamese rice in the firstseven months of this year, sale to China only accounted for 24.7 percent of thetotal shipments, which is much lower than last year’s figure of 40 percent.

In seven months, Vietnam sold 927,000 tonnes of rice to China and gained 491million USD, reducing 32.8 percent in quantity, and 21.2 percent in value ascompared to the same time last year.

Upbeat signs for rice exports in Q4

However,the ministry has predicted a bright prospect for rice exports as purchasedemand is expected to pick up in China, the Philippines, Indonesia, and Iraq.

The Philippines wants to import additional 500,000-800,000 tonnes of rice bythe end of this year to refill its exhausted reserves and to stabilise domesticrice price.

Chinese enterprises have recently worked with those from Mekong Delta region toseek cooperation in rice trade. Meanwhile, Indonesia and African countries alsohave high demand for rice import in response to output decline due to floodsand storms.
 
Local firms are seeking ways to boost sticky rice shipments to Indonesia toreduce independence on Chinese market. The move has made sticky rice priceslightly increase to 440 USD per tonne instead of below 400 USD per tonne inJuly and August.

However, Lam Anh Tuan, director of Thinh Phat Co., Ltd, said that Vietnameserice still faces challenges as it is sold at equal or higher price as comparedto competitors, and most of the importers like the Philippines and Indonesiaprefer low prices.

Thus, relevant authorities should stay prudent when negotiating, he suggested.-VNA