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Vietnam struggling to export 4.5-4.6mil tonnes of rice
After considering agricultural production in the first eight months of the year, experts believe that Vietnam can export 4.5-4.6mil tonnes of rice this year. However, this will be a difficult task as Vietnam has only four months and the supply of rice in the world is profuse.
According to the Vietnam Food Association, by August 7, 2008, Vietnam had exported nearly 2.76 mil tonnes of rice, FOB valued at over US$1.603bil, and CIF valued at VND1.743bil. In July alone, Vietnam exported 405,226 tonnes of rice, FOB valued at $333.40mil and CIF valued at $379.79mil. The figures represent a decrease of 1.7% in quantity and increase of 94% in value.
Vietnam’s main export markets are Asian countries, which consume 61.58% of exports, Africa (17.13%), America (14.73%) and other countries in the Middle East (4.2%) and Europe.
In June 2008, Cuba surpassed the Philippines to become the biggest rice export market for Vietnam, consuming 85,200 tonnes, worth $102.6mil, representing a 27.9% increase in quantity and 48.1% in value compared to May 2008. In H1, the total exports to the market were 336,575 tonnes worth $296.8mil.
Meanwhile, Vietnam’s second-biggest market, the Philippines, saw a sharp decrease in imports, 61,542mil tonnes, worth $58.3mil tonnes, down by 77.5% in quantity and 73.9% in value compared to May 2008. However, the total exports to the market in H1 were relatively big, at 1,101,806mil tonnes, worth $633.6mil.
The rice exports to Angola also witnessed the sharp increase of 148.1% in quantity and 224.3% in value over the previous month, 25,600 tonnes, worth $19.4mil. The exports to Russia in the month also increased to 8,097 tonnes, bringing the turnover of $6.768mil.
Poland has never been a big export market for Vietnam, but it really saw a sharp increase in export turnover (+153.9% in quantity and + 187.9% in value).
According to the Ministry of Industry and Trade, the world’s prices are on the decrease due to the bountiful crops in big rice export countries like Vietnam, Thailand, Pakistan, while big import countries have bought volumes big enough to meet the demand.
Thailand’s inventory volume has reached 2.57mil tonnes, up by 20% compared to the beginning of 2008. The country expects to harvest 7.6mil tonnes of paddies in August and September, up by 3.6mil tonnes from the 4mil tonne level in the same period last year.
Thailand’s rice price has decreased by over 30% with the white rice price down to the floor price of $700/tonne. The country is conducting negotiations to sell 850,000 tonnes to Iran, 250,000 tonnes to Nigeria, and it will sell stocks after fulfilling transactions with the countries.
Sources say that Iran has tried to contact Vietnamese exporters, but no successful deal has been reported, as Iranian dealers are offering $500/tonne, too low for Vietnamese exporters.
Pakistan is optimistic about rice supplies, and it may export 5mil tonnes of rice.
According to the Ministry of Industry and Trade’s Import-Export Department, importers are paying nearly $500/tonne FOB for Vietnam’s 5% broken rice. However, the importers still hope the prices will fall further, therefore, they do not hesitate to sign big contracts.
Meanwhile, the paddy price in the domestic market has been falling down. Farmers are harvesting a bountiful summer-autumn crop in Mekong River Delta. Good dried paddy is now selling at VND4,400-4,500/kg.
However, in many localities, paddy is now selling at VND2,900-3,100/kg only, while the production cost is VND3,900/kg. As farmers have to undersell paddy, the yield of the next crop will be influenced.
In order to boost rice exports, the government has decided not to collect export tax on rice exports at the price of less than $800/tone.
VNN
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