Rice exports exceed 2017 targets

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Volume passes annual target in November, in a year when rice exports were widely expected to struggle.

Contrary to forecasts earlier this year that rice exports would face a host of difficulties, figures from the Ministry of Industry and Commerce (MoIT) show that exports have actually exceeded targets.

Rice exports in the first eleven months of 2017 reached 5.52 million tons worth $2.49 billion, up 24.1 per cent and 24.9 per cent, respectively, year-on-year.

Exports are expected to total 400,000-450,000 tons in December, bringing the total volume for 2017 to 5.9-6 million tons, an increase of 1.1-1.2 million tons compared to 2016.

2017 is therefore considered a successful year for the rice sector, given the export target was set at 5 million tons at the beginning of the year. The market was expected to face difficulties stemming from many importing countries turning to self-sufficiency. Many of Vietnam’s major markets in Southeast Asia are gradually changing their rice import mechanisms, from government imports to private enterprise imports and bidding.

Experts, however, said the impressive growth in rice exports this year is primarily due to the impact of climate change, which has caused rice supplies in some countries to fall, with import demand rising as a result. Rising rice exports to new markets such as Bangladesh and Iraq also contributed to this year’s growth.

Mr. Nguyen Van Don, Director of the Viet Hung LLC, told local media that rice export growth this year was mainly due to increases in exports to China, especially for aromatic rice and sticky rice. The company’s export turnover in 2017 is expected to increase by 20 per cent over last year on the back of greater exports to Vietnam’s northern neighbor.

Volumes exported to other markets also increased sharply. For example, in the first ten months of the year, rice exports to the Philippines rose 41.3 per cent year-on-year, to Malaysia 97.3 per cent, and to the Ivory Coast 39.7 per cent. Some markets saw unexpected growth, such as South Korea, up 470 per cent, and Saudi Arabia 210 per cent.

Other businesses have also sought to export to markets of potential such as the EU and Japan. According to Mr. Nguyen Thanh Long, CEO of the Gao Viet Limited Company, in recent years it has focused on exporting white rice to Eastern Europe. 2017 revenue from the market is estimated to have increased by 20 per cent against 2016.

Businesses forecast that rice exports will continue to grow significantly thanks to increasing demand in China, the Philippines, South Korea, and Iraq.