Rice export exceeds $3 billion in 2010

Vietnam’s rice export revenue this year is estimated to set a record of over US$3 billion, said Vietnam Food Association (VFA) chairperson Truong Thanh Phong at last week’s meeting to discuss the rice export situation.

Vietnam’s rice export revenue this year is estimated to set a record of over US$3 billion, said Vietnam Food Association (VFA) chairperson Truong Thanh Phong at last week’s meeting to discuss the rice export situation.

Farmers in Cho Moi District, the Mekong Delta province of An Giang dry unhusked rice (Photo: SGGP)
Farmers in Cho Moi District, the Mekong Delta province of An Giang dry unhusked rice (Photo: SGGP)

Mr. Phong said the country made US$2.916 billion from exporting 6.267 million tons of rice at an average price of US$426.59 per ton in November, up 9.94 percent and 15 percent in terms of volume and value.
 
Local enterprises are expected to export 400,000-450,000 tons this month, bringing the total for the whole year to 6.7 million tons, he added.
 
According to VFA, the global price of rice will soar next year because of high demand from Indonesia, Iran, Bangladesh, the Philippines and Malaysia. The supply of rice is limited.
 
At present, Indonesia is continuing to buy large volumes of rice, which is pushing up the price.
 
After originally purchasing 550,000 tons from Vietnam and 50,000 tons from Thailand, Indonesia is also going to purchase an additional 225,000 tons from Thailand.
 
In addition, Indonesia is also intending to buy more rice from Pakistan, at an extremely high price of US$760 per ton. 
 
Due to a limited supply of rice from India, Bangladesh has asked for a negotiation with Vietnam for an annual stable import of rice.
 
Furthermore, the Philippines have reached an agreement with Vietnam, to import 1.5 million tons of rice per year from 2011 to 2013.
 
The export price of rice is forecast to increase by 15-20 percent, while a forecast from Singapore-based Duxton Asset Management Group says the price will surge by three times in the next 18 months.
 
Five percent broken rice was exported at US$540 per ton from Thailand and Vietnam, and US$475 per ton from Pakistan early in December.
 
Cautious about exporting rice
 
Because of the high export price and demand, Vietnamese enterprises have agreed that they need to be prudent in exporting rice until the end of next January. This is because they need to ensure adequate supply of rice for domestic consumption.
Mr. Phong warned that there will not be much rice for export in next January and February.
 
Vietnam has forecast to have only 5.5-6 million tons of the grain for export in 2011, with 500,000 tons in stock from 2010, while the figure was 1.4 tons early this year.
 
Cao Minh Lam, chairman of An Giang Import-Export Company, said the winter-spring crop has just been seeded and the rice produce in 2011 will not be as high as in 2010.
 
Therefore, he said, the export of rice should be restricted a little, until the first quarter of next year.
 
Agreeing with Mr. Lam, Pham Thai Binh from Trung An Company said VFA should make plans in buying rice for the coming winter-spring crop from farmers, so it can make plans for the export of rice.
 
VFA chairperson Phong said the cost price of winter-spring rice will be high due to unfavorable weather conditions, the increase of the price in fertilizers and insecticides, and the high interest rates for borrowing capital.
 
Mr. Phong said enterprises should buy rice at reasonable prices, which will ensure farmers enjoy good profits, and all enterprises should buy rice directly from the farmers, and not via go-betweens.
 
He said that VFA proposes to stock over one million tons of winter-spring rice, and one million tons of summer-fall rice. 

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