Viet Nam posted strong growth in rice exports in January. — VNA/VNS Photo Dinh Hue
Viet Nam exported 560,000 tonnes of rice in January 2020, earning US$270.3 million, an increase of 12 per cent in volume and 39 per cent in value month-on-month, according to the General Department of Customs.
Exports rose by 28.1 per cent in volume and 38.4 per cent in value year-on-year.
Since the start of the winter-spring rice crop, domestic prices have remained stable while export volume has surged. Before the Tet festival, local businesses contracts to ship rice to the Philippines and Malaysia due to more competitive prices than other countries.
FOB (free on board) prices stand between $340 and $350 per tonne for five-per-cent-broken rice, falling $10-$20 for 15-per-cent broken rice and 25-per-cent broken rice.
This year, the Philippines is expected to maintain its import volume, while the African market is forecast to purchase 1 million tonnes, followed by Malaysia at 500,000 tonnes.
The nation also exports from 300,000 to 400,000 tonnes to Cuba each year, while Iraq buys about 300,000 tonnes. China plans to buy 400,000 tonnes of local rice every year.
Bui Thi Thanh Tam, general director of the Northern Food Corporation, said five years ago, China was the largest market for local rice but now Viet Nam had expanded its export markets. This meant the coronavirus epidemic would not take a big hit on Viet Nam's rice exports.
Do Ha Nam, vice chairman of the Viet Nam Food Association, said China would continue to tighten rice imports this year, so the rice import quota from Viet Nam would stay the same as last year.
However, Viet Nam has a chance to boost its rice exports to Japan this year because it wants to diversify its rice import sources by seeking other suppliers from countries that have signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), including Viet Nam. At present, Japan depends on US rice supplies.
The Import-Export Department under the Ministry of Industry and Trade also said, besides allocating a quota of 20,000 tonnes of rice to all members of the World Trade Organisation (WTO) this year, South Korea had given a quota of 55,112 tonnes of rice for Viet Nam, according to a multilateral agreement between South Korea and five WTO partners, including Australia, the US, China and Thailand.
To take this export opportunity, local exporters were looking for more information about the Korean market and the tariff quota mechanism to develop their production and business plans.
Nam said this year, Viet Nam was forecast to export the same volume as 2019 or a slight increase.
However, drought and saline intrusion were likely to reduce rice output this year.
In addition, prices were also expected to decline due to lower demand on the world market, according to the Ministry of Agriculture and Rural Development. Many countries have been restructuring their agriculture sectors to move towards self-sufficiency.
Meanwhile, Viet Nam now faces difficulties finding new rice markets.
Last year, Viet Nam experienced a fall in rice export value of 10 per cent to $2.76 billion but a surge of 3 per cent in export volume to nearly 6.3 million tonnes. The main reason was falling global prices.
The Philippines was the largest export market for Vietnamese rice with a value of $885 million, a year-on-year rise of 92.58 per cent, according to the General Department of Customs.
Markets with strong growth in rice export value included Senegal (98 per cent), Ivory Coast (78.6 per cent), Taiwan (31 per cent), Hong Kong (28.3 per cent) and Tanzania (26.6 per cent).
Viet Nam’s rice has been exported to 150 countries and territories around the world. — VNS