Vietnam’s rice exports grow despite pandemic
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|Rice exports maintain growth momentum. Photo: NhanDan|
Many orders to major markets
Recently, Trung An Hi-tech Farming Joint Stock Company (Can Tho city) won the bid to sell two lots of rice to the Korean market. The type of rice Trung An won the bid was long grain brown. In which, one lot has a volume of 11,111 tons with a price of US$572/ton and the other has a volume of 11,111 tons with a price of US$578.5/ton (CIF price). If deducting freight, loading, unloading and customs clearance fees, the FOB price in Vietnam is also on average more than US$500/ton. This is a pretty good price. One batch will be delivered to the port of Incheon in September and the other to the port of Ulsan in October.
This is the second time Trung An has won the bid to sell rice to this market since the beginning of the year with a total volume of 33,458 tons and all are supplied by Trung An Hi-tech Farming Joint Stock Company. Korea is one of the markets that consume quality rice and the continuous winning of export orders to this country has shown that Vietnamese rice has increasingly improved in quality.
In addition to Korea, Vietnamese rice has successfully conquered many markets in recent years. Statistics from the Ministry of Industry and Trade show that rice export activities in the first months of the year have achieved positive results. Although the volume decreased, the export price increased sharply in the first four months of 2021, with the volume reaching 1.89 million tons, worth US$1.01 billion, down 10.8% in volume but up 1.2% in value over the same period in 2020. The average export price of rice in the first four months of 2021 reached US$534/ton, up 13.4% over the same period in 2020.
The export price of Vietnam's rice continued to remain at a relatively positive level compared to "competitors" in May. Specifically, according to the Trade and Industry Information Center (Ministry of Industry and Trade), the export price of rice of India - the world's largest rice exporter in the last week of May decreased for the 7th consecutive week. This is because the supply increased after the government released the stockpile to help the poor overcome difficulties caused by the Covid-19 pandemic.
Similarly, the price of Thai rice in the past week also decreased, 5% broken grade from US$475-485/ton to US$465-473 USD/ton, the lowest in more than 6 months. Meanwhile, the price of 5% broken rice for Vietnam's export last week was stable at US$490-495/ton, higher than the rice of these two countries.
|Rice exports grow during the pandemic. Photo: Dan Tri|
More support for businesses
Forecasting about rice exports in the coming time, experts say that the situation will get better thanks to the increasing number of orders. Businesses focused on finding contracts with markets like the Philippines and China when these two markets started to increase their purchases. At the same time, actively seek opportunities with markets that have FTAs with Vietnam such as the UK and EU. The recently signed FTAs have been helping Vietnamese rice become more known. As the market gradually expands, Vietnamese premium rice and specialty rice will add to the overall value.
However, from another angle, according to the assessment of rice exporters, although the current policy for rice export has been relatively stable, in the context that Vietnam has signed many FTAs, there is still a need for more change to fit the new situation.
To improve Vietnam's rice export market share at a more competitive price, Tran Quoc Toan, deputy director of the Import-Export Department under the Ministry of Industry and Trade, said that the ministry has been, and will be, chairing and coordinating with other sectors to effectively implement signed FTAs to make the most of market opportunities such as Korea and EU. Along with that, the Ministry will implement solutions on mechanisms and policies, remove technical and trade barriers, internalize international commitments, customs procedures, and logistics to help rice exporters exploit good market.
For rice exporters, Tran Quoc Toan noted the need to be more proactive in improving the competitiveness of products through quality and price as well as building and protecting brands to diversify markets towards sustainable exports.
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