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Boosting the rice reserves
Prime Minister Nguyen Tan Dung has instructed the Ministry of Finance to buy 50,000 tonnes of rice to supplement this year's national food reserves.
A total of VND30 billion (US$1.59 million) will be drawn from the State budget for 2009 and VND420 billion ($20.1) for budget for 2009 and VND420 billion ($20.1) for 2008 for the purchase.
The money will be drawn from increased budget revenue during 2008. The Prime Minister has also approved the spending of VND35.2 billion ($1.85) for the maintenance and repair of grain storage facilities.
The decisions are expected to both ensure food security and stabilise the market-price for rice.
he price of the grain has continued to drop in the Cuu Long (Mekong) Delta despite the Viet Nam Food Association's (VFA) request to its 30-member enterprises last Thursday that they buy 1 million tonnes.
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District trading floors for produce
District trading floors to link the supply and demand for agricultural produce will be established in the second quarter following an agreement between the Viet Nam Farmers' Association Central Committee and Pho Cho Co Ltd.
The floors will provide information about both produce and the market and serve as a network for the sale and distribution of domestic produce.
The trading floors were an innovate model to help Viet Nam's agricultural produce reach the regional and global consciousness, explained association deputy chairman Nguyen Duy Luong. | VFA deputy chairman Pham Van Bay said the first 600,000 tonnes would be bought this month and the remaining 400,000 tonnes, by the end of April when farmers have completed the harvest of their winter-spring crops.
The rice was for the reserves but more might be bought if export contracts were secured.
VFA chairman Truong Thanh Phong told an association meeting in the southern-delta province of An Giang yesterday the buying might continue after the 1-million-tonne purchase if farmers still had too much grain in stock.Newly-milled rice sold for VND4,000-4,200 ($.2) per kilo yesterday, about VND200-400 less than one week ago, and more than VND1,000 lower than at the start of the year.
The VFA has set a minimum price of VND4,000 per kilogram to the farmers for the winter-spring crop.
Deputy Industry and Trade Minister Nguyen Thanh Bien told the VFA meeting that a draft decree to prevent dumping would be issued soon.
Enterprises selling rice at lower than the set minimum would face a fine and repeat offenders were liable to have their business licences revoked, he said.
Farmers worry
Farmers worry that the VND4,000 minimum will make it difficult for them to generate a profit from the quite costly crops.
An Giang Plant Protection Department director Nguyen Huu An said the price of fertiliser and fuel meant the average cost of the winter-spring rice was between VND3,400-3,600 per kilogram.
The profit for even those farmers able to use technology to reduce the cost of growing the rice to VND3,200 per kilo would total only 20 per cent with a minimum of VND4,000, said Agricultural and Rural Development Department director for An Giang Province's An Phu District Huynh Thanh Phong.
The floor price should have been between VND5,000 and5,500 to allow farmers to recover their losses from previous crops, he said. The VFA has forecasted that Viet Nam will have to eat 11.54 million tonnes of rice to consume all that will go to market this year.
The figure does not include the surplus from2009.
Viet Nam plans to export about 6 million tonnes of rice, mostly in the middle of the year, to such countries as the Philippines and Malaysia as well as Africa.
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