China set to cut into India, Vietnam rice exports in 2017
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Falling demand and overseas competition are expected to bite into Vietnam’s rice exports. India and Vietnam, the world’s leading rice exporters, may see overseas sales fall below previously expected levels due to slowing demand and rising competition from China, the U.S. Department of Agriculture (USDA) said in a recent report.
India’s rice exports year could fall by 300,000 tons to only 10 million tons “on slower pace and stronger competition in West Africa”, the USDA said in its March report, putting it on a par with shipments expected from Thailand.
It more than doubled its forecast for China’s rice exports this year to 500,000 tons from 225,000 tons, the report said, citing rising sales in East Asia and West Africa.
The USDA also cut Vietnam’s rice export forecast by 3.6 percent to 5.6 million tons this year, citing “reduced trade to Southeast Asia and Africa”.
With the lower projections, India and Thailand will share the world’s largest rice exporter title this year, followed by Vietnam and Pakistan. Last year, India was the world’s biggest rice exporter, followed by Thailand.
Vietnam’s rice exports in the first two months of this year fell 23.5 percent from the same period in 2016 to 738,000 tons, based on data from Vietnam Customs released this week.
Rice exports in the two-month month period brought in $314 million, 24.7 percent below the corresponding period in 2016, data showed.
On a brighter note, Mexico has given the green light for 150,000 tons of rice to be imported at a zero percent tariff, starting from March 1, to meet domestic demand and diversify its supply sources, a move that would cut the market share currently held by the U.S. and open the door to Vietnamese rice.
“The United States is expected to remain the dominant supplier (for Mexico), but recent history suggests that other suppliers will likely gain additional sales,” the USDA said.
Questions & Answers
Q.Which countries are expected to be the largest rice exporters this year?
Which countries are expected to be the largest rice exporters this year?
India and Thailand are forecast to share the title of the world's largest rice exporters this year. They will be followed by Vietnam and Pakistan, according to the recent USDA report.
Q.Why are Vietnam's rice export forecasts being cut?
Why are Vietnam's rice export forecasts being cut?
Vietnam's rice export forecast was cut by 3.6 percent to 5.6 million tons this year. This reduction is attributed to reduced trade to Southeast Asia and Africa, coupled with slowing demand and increased competition.
Q.How much has China's rice export forecast increased for this year?
How much has China's rice export forecast increased for this year?
China's rice export forecast for this year has more than doubled. The USDA increased it from 225,000 tons to 500,000 tons, citing rising sales in East Asia and West Africa.
Q.What impact will Mexico's new import policy have on rice suppliers?
What impact will Mexico's new import policy have on rice suppliers?
Mexico's decision to allow 150,000 tons of zero-tariff rice imports could cut the market share currently held by the US. This move is expected to open the door for additional sales from other suppliers, including Vietnamese rice.