Vietnam exports 1.7 million tonnes of rice in Q1
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Vietnam exported 1.7 million tonnes of rice in Q1 worth over $900 million, a 19% increase in quantity and 30% rise in value over the same period last year, according to Vietnam Customs.
According to the Ministry of Industry and Trade (MoIT), Vietnamese rice has seen some success in improvements in quality and demand over the last several years.
The majority of exported rice came from the Mekong Delta, with the rest of the country’s rice production centres mainly serving the domestic market.
Le Thanh Tung, deputy head of the plant cultivation department under the Ministry of Agriculture and Rural Development (MARD), said rice production this year for the Mekong Delta alone is projected to reach 24 million tonnes. Consumption for the Delta and Ho Chi Minh City, Vietnam’s most populous city, will stay around 11 million tonnes, leaving 13 million tonnes for export.
Of which, premium-quality rice for export accounts for 3 million tonnes, specialty rice 2.1 million tonnes and regular rice 1 million tonnes.
Vietnamese rice will likely continue to be sought after in the second quarter of the year as demand has been on the rise in major markets including the Philippines, China and Africa, said the Vietnam Food Association (VFA).
Nguyen Ngọc Nam, President of the VFA, said Vietnamese rice has been fetching good prices on the international market despite a gloomy outlook for the global economy as countries look to stock up on food for uncertain times ahead.
In addition, major free trade agreements including the European Union – Vietnam Free Trade Agreement (EVFTA) have seen tariffs on Vietnamese rice reduced by as much as EUR175 per tonne, giving Vietnamese premium rice an advantage in the European markets.
As demand soars, exporters have been trying to purchase additional amounts from farmers to maximise efficiency and profit. However, many have voiced concerns over a lack of capital.
Phan Van Chinh, Director of MoIT’s Agency for Foreign Trade, said the ministry has been working closely with exporters to find solutions to minimising logistic costs and dealing with import/export protocols in international markets.
On the other hand, the ministry said it is to keep a close watch on the amount of rice being exported to ensure the country’s food security.
In an earlier development, the State Bank of Vietnam (SBV) has ordered commercial banks to review and streamline the borrowing process for rice traders to help them access additional capital sources.
Questions & Answers
Q.Which specific markets are driving the increased demand for Vietnamese rice in the second quarter?
Which specific markets are driving the increased demand for Vietnamese rice in the second quarter?
Demand for Vietnamese rice is rising in major markets. These include the Philippines, China, and various countries across Africa. This trend is expected to continue into the second quarter of the year.
Q.What is the projected surplus of rice available for export from the Mekong Delta this year?
What is the projected surplus of rice available for export from the Mekong Delta this year?
The Mekong Delta is projected to produce 24 million tonnes of rice this year. With 11 million tonnes for domestic consumption in the Delta and Ho Chi Minh City, 13 million tonnes will be available for export.
Q.How are free trade agreements benefiting Vietnamese rice exports, specifically in the European market?
How are free trade agreements benefiting Vietnamese rice exports, specifically in the European market?
Free trade agreements, such as the EVFTA, have reduced tariffs on Vietnamese rice. This reduction can be as much as EUR175 per tonne, giving Vietnamese premium rice a competitive advantage in European markets.
Q.What measures are being taken to address the capital concerns raised by rice exporters?
What measures are being taken to address the capital concerns raised by rice exporters?
The State Bank of Vietnam has directed commercial banks to review and streamline the borrowing process for rice traders. This aims to help exporters access additional capital sources to support their operations.