Rice Export Prospect in 2005
According to the Vietnam Food Association, in 2004, Vietnam’s rice export volume exceeded four million tonnes but the country failed to achieve a target of US$1 billion in revenues. The 2005 target is to earn US$1 billion in export turnover.
In the early days of 2005, Vietnamese enterprises signed contracts to export over one million tonnes of rice. The average export price increase by US$20 per tonne against late 2004. These are two optimistic factors for Vietnam’s rice export in 2005. Indeed, by late first quarter of this year, Vietnam had exported 961,000 tonnes of rice, earning US$266 million, up by 5.2 per cent over the same period last year. Mekong delta provinces, which produce 90 per cent of exported rice in Vietnam, had a bumper winter-spring crop with a yield of seven tonnes per hectare, bringing the total harvested output to 8.7 million tonnes, or a surplus of over five million tonnes for export. An Giang province produces most rice in the Mekong delta, producing 1.45 million tonnes of rice in the winters-spring crop. In the first quarter of 2005, enterprises in An Giang province collected 195,000 tonnes of rice and 10,000 tonnes of unprocessed rice. These enterprises exported over 100,000 tonnes, earning US$26.6 million, equal to 92.5 per cent of that of the same period last year in terms of volume and up by 13.2 per cent in terms of value. Many enterprises in An Giang and Can Tho said that Vietnam’s rice export had a favourable condition because of a reduction in the number of exporters in the world. Also, prices of Vietnamese rice are much lower that other countries in the region. As a result, customers have signed contracts to import Vietnamese rice from February to June with a higher volume that one year ago. Exporters in Can Tho alone exported 406,682 tonnes. They have set a target of 420,000 tonnes in 2005. In the first quarter alone, they exported 111,000 tonnes, earning a value of US$27 million.
This year, Mekong delta has expanded their areas under high quality rice varieties, such as Fasmine, ST1 and ST5, which has helped increase Vietnam’s rice export value. An Giang province alone has 12,400 hectares under fragrant rice varieties which have been sold to exporters. The Song Hau Food Company alone has invested to collect 1,700 hectares of fragrant rice varieties of ST1 and ST5 with farmers in Soc Trang, Hau Giang and the Red Flag Farm with a volume tripling that of 2004. Prices of fragrant rice are US$30 per tonne higher than normal rice with five per cent of broken. This is another factor for the achievement of a target of earning US$1 billion in export turnover in 2005. This target may be realistic with the promotion of the export of high quality rice, from 35 to 45 per cent of the export volume, and the expansion of markets for fragrant rice products.
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