Bags of rice loaded onto a ship for export at Cua Lo Port in the central province of Nghe An. — VNA/VNS Photo Danh Lam

Viet Nam exported 4.01 million tonnes of rice worth US$1.73 billion in the first seven months of 2019, up 2.1 per cent in volume but down 14.3 per cent in value from the same period last year, according to the Ministry of Agriculture and Rural Development.

In July alone, the country shipped 651,000 tonnes of rice worth $285 million.

Minister Nguyen Xuan Cuong said this year, prices of agricultural products in markets around the world have fallen by between 5 and 15 per cent. Notably, rice prices have fallen sharply in all segments.

He said the El Nino in late 2015 and the first half of 2016 led to a decline in global grain output, forcing countries to re-stock their reserves once supply returned to normal. As a result, 2018 was a very strong year for the rice market in terms of both export volume and value, helping Vietnamese rice prices reach a record of more than $500 per tonne on average.

However, many countries – including big ones that purchase large amounts of Vietnamese rice – had already restocked their reserves by the start of 2019, leading to a year-on-year downturn.

Cuong said that in the short term it is necessary to explore new markets, especially in Africa and ASEAN, to make up for the drop in shipments to China – a major importer. Meanwhile, production costs must be reduced by applying scientific advances to ensure farmers profit.

In the long term, the agricultural sector is planning to transform 500,000ha of land currently used to grow rice for use in aquaculture or growing fruit or other cash crops to ease the rice output pressure.

The rice industry will need to promote processing and value chains to make use of not only the grain but also its by-products like the husk, bran and oil and diversify offerings to provide organic and medicinal rice, the minister noted.

The Philippines was the biggest buyer in the first half of the year, purchasing 33.7 percent of Viet Nam’s rice exports.

The markets with strong growth in rice imports from Viet Nam included the Ivory Coast (up 67 per cent), China’s Hong Kong (60 per cent) and Saudi Arabia (38 per cent).

Export prices of rice averaged $431 per tonne in the six month period, down 15 per cent from the first half of 2018.

The ministry forecast that rice prices in the country would increase in the coming months thanks to higher demand. — VNS