It is a surprise that countries participating in the rice tender recently offered by the Philippines National Food Authority (NFA) have received wide spread attention. Tenderers came from France, Hong Kong (China), especially those from Thailand and Vietnam. Not only the Vietnam Food Association (VFA) but also rice farmers, local leaders and the press also followed this rice tender.
At NFA's tenders opened by the Filipino government in previous years, companies from Vietnam usually could win quite easily because Vietnam's rice prices are always much lower than Thailand's rice. Therefore, winning the tender is not too surprising. However, this time is different.
Inventory pressure of Thailand is too heavy with approximately 17 million tonnes because of buying price subsidy policy of 50 percent higher than the market when oversupply is overwhelming the world. Many assume that Thailand will reduce the price, targeting 1 million tonnes sold a month. Recent market developments also show that the price of rice of Thailand and Vietnam are approaching each other.
This tender in the above context, especially when the sale of rice through the border from Vietnam got clogged due to load shipping control, has doubled freight rates, causing the price of rice in the Mekong Delta to drop to about VND200 a kilogramme.
Therefore, many businesses assume that the possibility of Vietnam winning the tender stays at 50 percent. Pessimists even said that Vietnam, hopefully, can only win part of 800,000 tonnes of tendered rice this time. Therefore, the information stating that VFA won 800,000 tonnes of 15-percent-white-milled rice supplying to the Philippines has become good news.
The amount of won tender this time is not as big as that Vietnam had achieved before. Compared to the total amount of rice for export all year, around 6.5 to 7 million tonnes, this is not a breakthrough. However, this has the effect of greatly relieving psychological pressure on consumption and rice inventories when it comes to harvest and when, on the world market, sellers outnumber buyers.
Through this case it can be understood to be due to fierce competition with Thailand, the tender winning price of Vietnamese enterprises participating this time cannot be as high as the previous time. Because of this, it has been rumour that if VFA had listened to suggestions by many experts, it could have won the whole supply of 800,000 tonnes at a higher price.
Everyone could see that advising is much easier and has to face less pressure than going for tender against stunned groups under the pressure of losing to consume rice when crops come. Is that because of this, firm scheme was made instead of risking? Everything has its price. It also can be seen that if one wants to succeed fully, it is essential to understand their rival and grasping more information from the outside is always the requirement set out.
PV
Vietnamese
