Rice prices up in domestic, foreign markets

Rice bags being loaded for export at the Sài Gòn Port. — VNA/VNS Photo Đình Huê

 HCM CITY — The price of Vietnamese rice has increased strongly in both domestic and foreign markets recently because of high demand and limited supply, local reports say. 

In the world market, Vietnamese rice is only priced lower than that from Thailand 

Jasmine rice is now priced at US$565-570 per tonne, $65-70 per tonne higher than three weeks earlier. 

Việt Nam’s 5 per cent broken rice is selling at $410-420 per tonne, up $35-45 per tonne, while 25 per cent broken rice is fetching $25-30 per tonne higher at $370-375 per tonne.  

Rice prices have also increased in the domestic market by an average of  more than VNĐ1 million ($44) per tonne, said Đặng Thị Kim Liên, director of Long An Food and Foodstuff Co Ltd.

Nguyễn Văn Đôn, director of Việt Hưng Co Ltd in the Mekong Delta province of Tiền Giang, said demand for jasmine rice has surged recently while supply was low. Some farmers are waiting for even higher prices before selling their harvest, he said. 

The competition between local businesses has pushed domestic rice prices higher than export prices. Some enterprises which have signed export contracts at lower prices are now facing difficulties.

Rising consumption

Market observers have attributed the price recovery in both domestic and foreign markets to a global surge in consumption.

Recent information on demand for Vietnamese rise in some countries like Bangladesh, the Philippines and Malaysia has also heated up the domestic market. 

Bangladesh has signed a Memorandum of Understanding with Việt Nam on rice trade and announced its intention of importing 250,000-300,000 tonnes of Việt Nam’s 5-per-cent broken rice in the coming month and about 500,000 tonnes for the whole year. The Philippines has also revealed its plan to buy 250,000 tonnes of rice in June and July. 

According to the Việt Nam Food Association, Việt Nam saw a drop in rice exports in the first five months of this year. However, there has been a recovery since May, with exports of the grain rising 27.3 per cent in volume and 24 per cent in value.

Việt Nam is expected to be the world’s fifth largest rice producer in 2017, according to the Crop Prospects and Food Situation report released by the UN’s Food and Agriculture Organisation (FAO).

The FAO has forecast that the biggest rice producer this year will be China with 142.3 million tonnes, followed by India with 110.4 million tonnes.

The report said the global rice output was likely to increase by 0.7 per cent to 502.3 million tonnes, thanks to production facilitation policies in Asia and yield recovery in South America and Australia.

After declining for two years, globally, rice exports are predicted to expand by 5 per cent in 2017 to 44.2 million tonnes, compared to 43.6 million tonnes the previous year.