VietNamNet Bridge - Vietnamese rice exporters have lowered selling prices, but are still finding it difficult to obtain export contracts.

Nguyen Cong Tri, a farmer in Thoi Lai District of Can Tho City, said he has sold all of his winter-spring rice, but at the “lowest ever price”. The profit was modest.

According to Tri, wet IR50404 was sold at VND4,000 per kilo. When the government began collecting rice for stockpiling, the price moved up to VND4,200-4,300 per kilo. 

However, farmers did not benefit from the stockpiling program, before they had sold out of their rice. Meanwhile, the price was VND4,600-4,800 per kilo in previous years.

“Previously we could pocket VND1,800-2,000 per kilo, but now we can earn VND1,200 only,” he said.

“I heard the price has fallen because China has shifted to buy high-quality rice and placed smaller orders,” he said. “Meanwhile, Vietnam’s rice is less competitive than Thailand’s and Pakistan’s”.

Nguyen Van Don, director of Viet Hung Company, confirmed that he had not seen such slow sales.

Don said Vietnamese rice is selling at the lowest level in the world. The common five percent broken rice is offered at $360-365 per ton, or $35-40 per ton lower than Thai rice of the same kind. Indian and Pakistani rice is $10-20 per ton more expensive. Vietnam also offers the lowest price for 25 percent broken rice.

Don explained that as Thailand, trying to clear its big stocks, has lowered its selling prices, the move has forced India, Pakistan and Vietnam to lower their prices to compete with Thailand. 

However, despite the price decrease, Vietnam’s rice cannot be easily sold. Thailand and Pakistan have been trying to conquer Africa, which was once Vietnam’s key market.

According to Don, in previous years, Vietnam relied on commercial contracts on exporting rice to China and government-to-government contracts with the Philippines and Indonesia.

However, China has changed its import policy, only seeking to buy high-quality long-grain 5 percent broken rice, while refusing 15-25 percent broken rice, which it had bought in previous years.

Le Van Banh, head of the Mekong River Delta Rice Institute, said that the world market now demands high quality rice, but Vietnam does not have this kind to export.

Banh said IR50404 is the most commonly grown rice in Vietnam, accounting for 50-60 percent of the total winter-spring crop production area in the Mekong River Delta.

However, Don is optimistic about rice exports in 2015. China is planning to grant import quotas to its businesses in the second stage, and will still need common cheap rice, he said. 

Meanwhile, the Philippines, Malaysia and Indonesia have to import rice in large quantities because of a shortage of domestic supply.

PL TPHCM