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Food group buys up rice to stabilise prices
The Viet Nam Food Association announced on Monday that it was to increase it's target of stockpiling rice from 1 million tonnes to 1.5 million tonnes.
"The price will be set in accordance with the market and will satisfy the winter-spring crop guarantee of a minimum 30 per cent profit for farmers," said Vice Chairman of the association Pham Van Bay.
According to Bay, the completion of the winter-spring crop harvest in the Cuu Long (Mekong) River Delta has seen rice prices jump to between VND4,200 and VND4,500 (22 to 24 cents) per kilogram.
He said that businesses had collected around 790,000 tonnes of the 1 million tonnes required. However, a lack of storage facilities and a gloomy export market have slowed collection.
Bay, however, was still optimistic about the rice export market after seeing poor harvests in competitor countries such as Indonesia and Bangladesh.
The association has asked its members to continue to stockpile rice and launch a website with up-to-date market information and support for farmers.
As of March 18, the country had signed contracts to export 3 million tonnes of rice, a drop of 12 per cent against the same period last year, according to the association.
Of the signed contracts, the country has shipped nearly 1 million tonnes worth US$465 million, a reduction of 25.9 per cent in volume and 12.8 per cent in value against the same period last year.
However, things are looking up now as several importers negotiate purchases of more rice from Viet Nam and export prices show an upward trend, according to the association.
Over the past two months, rice exports were implemented mostly via government-to-government contracts.
However, rice exporters had now begun to get commercial contracts, the association said.
Several markets like Indonesia, Bangladesh were also planning to import rice from Viet Nam, it added.
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