Vietnam clinches one million tonnes of rice deal in 2015

Vietnam riceThe volume is 200,000 tonnes higher than the same period last year. (Image source: IRRI)Member enterprises of the Vietnam Food Association (VFA) have already clinched export contracts for at least one million tonnes of rice with delivery scheduled for this year

According to VietnamNet, most of the volume would be delivered to customers in 2015, based on the contracts that VFA’s member enterprises signed with importers last year.

The volume is 200,000 tonnes higher than the same period last year.
Huynh The Nang, general director of Vietnam Southern Food Corporation (Vinafood 2), however, said local rice exporters might face many more difficulties this year.

The rice demand of the Philippines, Indonesia and Malaysia is forecast to jump, but Vietnam would have to compete with Thailand, which wants to reduce its huge rice stockpiles, The Nang added.

China, a major importer of Vietnamese rice in recent years, has signed an MoU to purchase two million tonnes of rice from Thailand in 2015.

Concerns have also risen among domestic rice exporters for tougher competition from India and Pakistan as these two nations have cut prices of their low and medium-grade rice to compete with similar products of Vietnam.

Currently, India and Pakistan sell five per cent broken rice at US$385-395 per tonne and US$380-390 per tonne respectively, compared to US$380-390 per tonne for Vietnam’s same type. Their 25 per cent broken rice is priced at US$350-360 per tonne and US$335-345 per tonne compared to US$350-360 per tonne of Vietnam.

According to VFA, Vietnam had exported 5.96mn tons of rice from 1 January to 18 December 2014, falling 11 per cent against the previous year. Up to 83 per cent was shipped to Asian and African countries and the rest to America, Europe and Oceania.

In order to boost rice shipments this year, Vietnam’s Ministry of Industry and Trade suggested rice exporters diversify markets and seek to make full use of the opportunities from bilateral and multilateral trade agreements, and follow updates on importing markets.

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