Vietnam: Rice Exports Expected To Fall Sharply This Year

22.09.2016

Vietnam hopes to export 1.6 million tonnes rice in the four remaining months of the year, raising exports for the year to 4.9 million tonnes, said the Vietnam Food Association (VFA).

Vietnam News Agency (VNA) reports that a report the VFA tabled states that exports of 3.3 million tonnes in the first eight months of the year fetched US$1.43 billion and represented a year-on-year reduction of 13.5 per cent in volume and 10 per cent in value.

More than a million tonnes worth of contracts are on hand as are 1.2 million tonnes of inventory.

Accordingto industry players, inventories were at high prices while global prices have declined, threatening to cause difficulties for them.

For instance, 5 per cent broken rice from Thailand usually sells at above US$400 per tonne, but currently stands at US$370.

Pakistani rice prices have fallen the most -- to around US$330.

It is unlikely for domestic prices to go up in a short time despite the contracts to export large volumes, the executives said.

Lam Anh Tuan, Director of Thinh Phat Co.Ltd, said rice exports this year would be below expectations.

Thailand's effort to increase exports amid a global slowdown in demand is among the reasons for prices to drop, he said.

The annual global rice trade is around 40 million tonnes a year, and any sudden increase in supply from one source hits the market share of others, he said.

"For this year the VFA set an export target of 6.5 million tonnes, but due to market volatility it has adjusted the target. The new target is 4.9 million tonnes, but nobody can predict anything because we depend on the market. If from now to year-end the market is good, rice exports will be higher.

According to the VFA also, rice exports to China reduced by 13.33 per cent in the first eight months of the year.

Firms said the Mekong Delta had almost completed harvest of the summer-autumn rice crop and the volume was not high.

Yet paddy prices are not very high because a large volume of Cambodian rice has entered the domestic market.

The country earned US$2.68 billion from export of 6.5 million tonnes of the grain last year, a decrease of 3.94 per cent in value despite a marginal increase in volumes as prices dropped.


bernama

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