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Vietnam rice exports surge, FAO predicts record year
Vietnam will probably exceed its rice export record by 4 percent this year, buoyed by a strong harvest and low prices, the Food & Agriculture Organization (FAO) predicts.
Shipments of the grain are set to reach 5.4 million tons, the UN body said in its Rice Market Monitor. On global tables, the figure would leave Vietnam behind only Thailand, which the FAO expects to export 8.3 million tons. Vietnam’s record rice export level is 5.2 million tons in 2005.
The 2.9 million-ton gap, which would be the smallest between Thai and Vietnamese exports since 2006, has been driven primarily by prices. The average export price of Vietnam’s 5 percent broken-grain variety declined by 10 percent between April and June, leaving it US$161 per ton cheaper than Thailand’s benchmark, according to the FAO.
“Excellent harvest results combined with competitive prices have led exports to surge,” the FAO said. Vietnamese authorities lifted a ban on new export contracts “amid concern over a slump in international prices over Thailand’s decision to auction state stockpiles and an anticipated return of India to the export market.”
The Vietnamese government has been targeting rice shipments this year of 5 million tons, according to the FAO. Exports may reach 6 million tons this year, as overseas demand rises, Nong Nghiep Viet Nam newspaper reported June 30. Vietnam has reported a bumper winter-spring rice harvest, Thoi Bao Kinh Te Viet Nam newspaper reported the same day.
Philippines, Indonesia
In May, the Philippine National Food Authority was authorized to buy as many as 2 million tons of rice to build up reserves, after having already sourced 1.5 million tons from Vietnam, the FAO said.
“Global rice imports in 2009 are forecast to rebound,” the FAO said. “The revival of import demand is being facilitated by the decline in world rice prices.”
While overall Vietnamese exports declined 10 percent in the first half, rice shipments rose 56 percent by volume to 3.8 million tons and 24 percent by value to $1.82 billion, according to the General Statistics Office in Hanoi. Rice was Vietnam’s fifth-biggest export in that period, after garments, crude oil, precious metals, and shoes.
“If rice prices rise in the future, the government may bring rice-export curbs to protect domestic consumption,” said Tai Hui, head of Southeast Asian economic research at Standard Chartered Plc. “So rice exports can’t really benefit when prices rise. Hence, this boils down to a volume game, which is at the discretion of harvests and external demand.”
Vietnam’s rice-export industry may be benefiting from reduced consumption of the grain in the world’s fifth-biggest rice-eating nation, which leaves more available to send abroad. Vietnamese national rice consumption this year will probably decline 1 percent, according to the US Foreign Agricultural Service.
thanhnien, bloomberg
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