Rice is loaded at the Viet Nguyen Food Processing Plant in the southern province of Tien Giang. The Viet Nam Food Association estimated rice exports this month would be 650,000 tonnes, 100,000 tonnes below the target. — VNA/VNS Photo Dinh Hue

HA NOI (Biz Hub)  — The Viet Nam Food Association (VFA) has lowered its rice export target for 2013 from 7.5 million to between 7 - 7.2 million tonnes with a turnover of US$3 billion due to low export levels and falling prices.

For this month alone, the association estimated rice exports would be 650,000 tonnes, 100,000 tonnes below the set target.

It forecast that rice exports would stand at 1.8 million tonnes by the end of the third quarter, 230,000 tonnes lower than previously planned.

The association's chairman, Truong Thanh Phong, said the rice export market had faced difficulties as supply outstripped demand, while rivals from Thailand implemented generous price subsidies for farmers and India's export volume rallied.

Phong said the market had seen fierce competition as rice prices in Thailand, India and Pakistan had fallen, bringing them closer to those of Viet Nam.

Viet Nam's rice price was $431 per tonne, equal to those of India and Pakistan, making it hard for the country to export to these markets due to transport costs.

The Ministry of Industry and Trade said countries such as Thailand, India and China used a large amount of their State budgets to purchase rice at high prices, while others took advantage of natural conditions, land and climate to produce high quality rice to gain competitiveness.

For example, India, the world's second largest rice producer strongly supported its rice market, while Myanmar, Cambodia and Pakistan had also made efforts to raise export volumes.

Rice importers had adjusted policies by increasing the food supply themselves, reducing inventories and carefully considering exporters.

Pham Van Bay, VFA's vice chairman, said Viet Nam's rice exports had seen shortcomings as its quality was not highly valued in the world market and the country lacked a well-known rice brand.

Bay said rice exporters lacked clear, long-term strategies for their exports as well as market expansion.

He said Vietnamese enterprises' ability to reserve rice was low, while pressure from high interest rates made them rush into selling their products.

Under the ministry's plan, Viet Nam would have just 150 rice exporters by 2015 to establish large production zones for in-depth business strategies. — VNS