Workers load rice bags for export. Asian and African countries were main buyers of Vietnamese rice during H1. — Photo thuvienphapluat.vn

HCM CITY (Biz Hub) — Viet Nam exported 2.71 million tonnes of rice in the first half at free on board (FOB) value of US$1.132 billion.

The Viet Nam Food Association said this represented a year-on-year decrease of 9.6 per cent in volume and 12.71 per cent in value.

Asian and African countries were the main buyers, with China remaining the largest importer.

VFA chairman Huynh The Nang said the reasons for the fall in exports were not new: abundant supply, the appearance of new exporters, and intense competition.

"There is severe competition in terms of prices," he told Biz Hub.

"Currently we can not compete with Thailand in exporting 25 per cent broken rice to Africa because our price is higher than that of Thai rice though our rice is of better quality."

But Viet Nam's 5 per cent broken rice and fragrant rice can compete in the market, Nang, who is also general director of the Viet Nam Southern Food Corporation, or Vinafood 2, said.

However, exports are expected to pick up in the second half, he said.

China would continue to buy and Viet Nam has a geographical advantage in selling to that country, but China's import quota policies and changes to cross-border trade policies caused difficulties for Vietnamese exporters, he said.

Malaysia could increase imports in the second half, he said.

Indonesia expects its grain output to rise this year and so will import little or nothing, but experts said it would buy around one million tonnes in the second half.

Nang said there were opportunities to boost exports this year.

The association and its members would focus on promoting exports to mainland China, Hong Kong and Africa, he said, adding exports to Africa were expected to be higher than last year.

Companies have signed contracts to export 4.1 million tonnes this year and so have to ship another 1.389 million tonnes in the remaining months.

Despite facing fierce competition, the sector would meet this year's export target of 7-7.5 million tonnes, Nang said.

Viet Nam produces around 24 million tonnes of rice a year, and more than 16 million tonnes are consumed at home. — VNS