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Mekong Delta: Farmers having to undersell paddy
After the Prime Minister asked that all of farmers’ remaining paddies be purchased to ensure them the profit of 40%, the paddy price moved up slightly. However, farmers are having difficulty selling paddies at high prices as rice export companies’ collection systems include intermediaries.
In Vinh Long province, according to the provincial department of agriculture and rural development, 400,050 tonnes of paddies are left unpurchased. Vinh Long Import-Export Company and Vinh Long Food Company have been assigned to collect paddies from farmers in the province.
Le Quang Dung from Vinh Long said that the company is purchasing 1,000 tonnes of paddies a day and it has purchased 5,000 tonnes at VND6,300/kg, an increase of VND400/kg over the previous crop.
However, the said price was the one at which the company purchased paddies from merchants, who collected paddies from farmers to re-sell to the company. Meanwhile, farmers had to sell paddies at less than VND4,500/kg.
Chau Thanh Tung, Head of Hoa Thanh hamlet in Dong Thanh commune, related that there are 220 rice-growing households in the hamlet. To date, 130 households still cannot sell paddies. It is estimated that some 400 tonnes are left unpurchased, including 2 tonnes of Tung’s.
Tung said that farmers can sell paddies to ricemillers at VND4-4,300/kg, who then sell to merchants and the merchants after that sell to rice exporters. Thanh said that all the farmers in six hamlets of Dong Thanh commune have to sell paddies this way. In fact, the farmers heard about the instruction of the Prime Minister to collect paddies from farmers, but the information just exists on…TV.
In Can Tho province, farmers are selling paddies at VND4,600-4,800/kg, an increase of VND300/kg over the previous crop. Nguyen Khanh Lon, the owner of a rice-trading establishment in Cai Rang district, said that he purchases paddies from farmers to resell to enterprises to get profit. However, as the enterprises have not purchased rice for the last month, he cannot purchase additional paddies from farmers now.
In An Giang province, Hoang Thi Huong in Nui Sap town, said that the paddy price has slightly increased to VND4,500-4,600/kg, up by VND100-200/kg over the previous week’s level. “We have heard that enterprises will purchase paddies at VND5,500/kg, but in fact, no enterprise has accepted to buy paddies at the price,” she said.
Enterprises complain, farmers weep
Nguyen Hung Linh, General Director of the Kien Giang Trade and Tourism Department, said that the government is yet to give any preferences to enterprises to support their paddy purchases.
Linh said that the company has been assigned to purchase 20,000 tonnes of rice with the VND150bil the company borrows from commercial banks. However, with the overly high interest rates of 1.61-1.65% per month, the company would incur heavy losses.
Le Viet Hai, Director of Mekong Company, said that everyday, the company collects 500 tonnes or rice from merchants at VND5,900-6,500/kg to fulfill signed export contracts. Hai said that he has tens of tonnes of rice in stock which still cannot find outlets. If the company cannot find buyers by September, the company will have to stop purchasing paddies.
Khanh Lon, the owner of a rice-trading establishment in Can Tho city, complained that he still has 1,000 tonnes in stock, and as he cannot sell to exporters, he has to sell rice to domestic markets. He said that he is incurring losses by selling to markets, but has no other choice.
He added that he dares not purchase summer-autumn paddies now as he has no capital. He dares not borrow money from banks as he fears that he cannot sell paddies and cannot get money to pay the loans’ high interest rates.
Duong Nghia Quoc, Deputy General Director of Dong Thap Department for Agriculture and Rural Development, said that no enterprise is capable enough to send staffs to purchase paddies directly from farmers. In fact, the enterprises have to purchase paddies through petty merchants. Therefore, farmers cannot sell paddies at the desired prices. The current prices now in Dong Thap are hovering around VND4,300-4,500/kg, while some 600,000 tonnes of paddies remain unpurchased.
Farmer Le Thanh Phan in Phuong Binh commune in Hau Giang province complained that merchants require dry paddies, but farmers do not have dry paddies in the rainy season. Meanwhile, dryers have raised the drying service from 5% to 8% (farmers have to pay 80kg of paddies to dry 1 tonne). “How can we have dry paddies to sell?” he asked.
VNN
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