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How much rice China has purchased from Vietnam?
The Vietnam Food Association (VFA) late last week released important information: China has purchased up to 600,000 tons of summer-autumn crop rice from Vietnam, which may threaten national food security.
Nguyen Van Dung, a farmer in Vi Thuy District in Hau Giang Province, complained that low rice prices have made farmers suffer. The rice prices at which farmers sell to export companies cannot bring the minimum profit of 30 percent as instructed by the Government.
Meanwhile, farmers complain that they cannot understand why VFA warns about possible rice shortages, when farmers must sell rice cheaply or not at all.
China buys rice? Not a new story
Nguyen Dinh Bich, a rice expert, explained that it’s nothing new when China purchases rice from Vietnam. Some Chinese provinces near Vietnam regularly lack rice because of bad weather. Instead of carrying rice from other areas of China, which costs time and money, they would rather buy from Vietnam.
Vietnamese businesses in late June and early July, in the highest peak of the summer-autumn crop, noted that many ships docked in the ports of Can Tho, Dong Thap and An Giang to collect rice for export to China.
Pham Van Bay, Deputy Chair of VFA, knew that China buys rice, but he could not imagine that it would purchase rice in such a huge quantities.
According to VFA, an estimated 600,000 tons of rice have been exported to China, but there are no exact figures and official surveys warn about the impact on national food security.
VFA issues warnings?
On July 9, in a meeting on summer-autumn rice, VFA observed that export companies are facing difficulties. Therefore, provincial authorities asked VFA member companies to buy rice at no less than 4000 dong per kilo, enterprises agreed to only 3500 dong per kilo.
Statistics on the volume of rice that companies planned to export from April to July do not show difficulties as VFA maintained. Firms are still selling rice as normal. Over the last four months, they sold nearly 2.8 million tons of rice.
The key problem that makes VFA worry about a possible rice shortage, is that member companies signed export contracts at low prices already (Less than $300 per ton for 25 percent broken rice and $340-350 per ton for five percent broken rice). Since China purchases rice from farmers, pushing domestic prices up a little, exporters fear losses.
According to Bay, many exporters would lose $30 per ton for 25 percent broken rice export contracts and $25 per ton for five percent broken rice.
Too early to claim China will affect national food security
By August 5, farmers had harvested 50 percent of the total summer-autumn crop rice. The merchandise rice volume is still high, at one million tons. From now to the end of 2010, Vietnam will have 800,000 tons of autumn-winter crop rice, and some one million tons of rice from Cambodia. Therefore, there is no reason to worry about a shortage.
Dr. Tran Tien Khai from HCM City Economics University urged verification of the VFA figures on rice sold to China. “I personally do not believe that within such a short time, one month, Chinese importers could purchase such a big volume of rice,” he argued, adding that it is necessary to check the information, or it will create unreasonable worries.
vietnamnet, SGTT
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