Vietnam’s rice exports projected to decline amid quality shift
A downward shift is projected for Vietnam’s rice exports in the current year, with estimates ranging between 6.5 and 7.0 million metric tonnes. This is a noticeable drop from the previous year’s record high of 8.1 million tonnes, as reported by the Vietnam Food Association.
Vietnam, ranking third globally in rice exports after Thailand and India, indicated a strategic shift towards exporting higher quality, higher-priced rice. This is in response to climate change adaptations and the need to guarantee domestic food security.
Despite the overall reduction strategy, the country witnessed a 14.4% rise in exports in the year leading to mid-February, amounting to 663,000 tons. This information was unveiled at an international rice conference and subsequently reviewed by Reuters.
According to the report, “Demand from Indonesia, Philippines, Malaysia, China and Africa has been increasing as El Nino is expected to last at least until mid-2024.”
In a strategic move last year, Vietnam declared its intent to slash annual rice exports to 4 million tonnes by 2030, as noted in a government document outlining the rice export strategy. The country also plans to diversify its rice export markets and reduce residues of plant protection products, including pesticides, in its rice.
In related news, prices for India’s rice exports have seen a significant surge, reaching a record high this week. This comes as traders eagerly await clear guidelines on the calculation of the export levy. Concurrently, Thailand’s rice market is anticipating fresh supplies.
India’s top export, the 5% broken parboiled variety, was quoted at a record US$552-US$560 per tonne this week, marking an increase from the previous week’s US$546-US$554.
Duty changes
Further, Indian traders are signing fewer new contracts for exports of parboiled rice following a change in the calculation method for the 20% export duty by customs officials. This has resulted in a higher levy, as reported by four industry officials to Reuters earlier this week.
Meanwhile, Thailand’s 5% broken rice prices have escalated to US$620-US$622 per tonne, from the US$615 quoted the previous week. Vietnam’s 5% broken rice was offered at around US$580, marking a decrease from US$600 a week before but an increase from US$575 earlier in the week, reported Bangkok Post.
The Vietnamese trader based in Ho Chi Minh City noted that a number of importers are not rushing to buy as they know that Vietnam’s main harvest is peaking.
“Prices, however, are recovering as rice production is still facing the adverse impacts of the El Nino phenomenon this year.”
In contrast, the government in Bangladesh is grappling with controlling the prices of this staple grain, despite having a good harvest and reserves. The country’s food minister announced the distribution of 150,000 tonnes of rice among five million families at subsidised rates before the start of the Muslim holy month of Ramadan.
