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Farmers suffer as mills push rice prices down
Farmers in the Mekong Delta complain they’ve had to sell paddy at lower prices during the past week even as food companies bought large volumes to fulfill the country’s rice export goal of 5 million tonnes for this year.
In the Mekong Delta province of Dong Thap, Nguyen Van Lac, a farmer from Long Phu Commune in Tan Chau District said OM 2514 paddy sold for VND4,430 per kg on March 27 but three days later he had to sell the same paddy for only VND4,330 per kg.
"I don’t know why paddy prices kept falling during the past week, while demand from rice mills is on the rise," said Nguyen Thi Thom, a farmer from Dong Thap’s Tan Hong District.
A manager of the An Giang Import-Export Joint-stock Co (Angimex) said Vietnamese rice is selling well in the world market, so paddy from this winter-spring crop should not be lower priced.
"It is the rice mills that are forcing paddy prices down," said the manager who declined to be named.
Farmers are bringing home large quantities of paddy as they harvest the winter-spring crop, creating favourable conditions for rice mills to force paddy prices down.
However, the manager added that because of the number of rice export contracts won for the first half of 2009, paddy prices could go higher over the next two months.
According to figures from the Ministry of Industry and Trade (MIT), Viet Nam exported nearly 1.75 million tonnes of rice in the first quarter of 2009, a year-on-year increase of 76 per cent. Viet Nam’s 5 per cent broken rice sold for US$448 per tonne last week, $22 lower per tonne compared with the previous week, while 25 per cent broken rice sold for $400 per tonne, $5 lower per tonne over the previous week.
The Ministry of Agriculture and Rural Development holds that increasing demand for rice for export in the next months will stabilise paddy prices, and could drive them higher.
Viet Nam targets exports of 4.5 million to 5 million tonnes of rice in 2009, and 3 million in the first six months of the year.
Prime Minister Nguyen Tan Dung had earlier asked the Southern Food Corp. and the Northern Food Corp. to purchase all the rice from farmers and ensure 30 per cent profits for farmers.
Huynh Minh Hue, acting chairman of Viet Nam Food Association, said rice prices are on the rise ensuring bigger profits for farmers.
Under the current situation, Hue said, Viet Nam could face a shortage of rice if more export contracts are signed in the coming months.
VietNamNet, vietnamnews
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