According to the Export and Import Department (the Ministry of Trade), rice export of Vietnam in 2005 reached a very good result. The control of rice exports has made the domestic market stable, enterprises successful in doing business and favourable prices for farmers.
However, we can’t deny the fact that, the balanced situation between supply and demand of export rice is not accurate. This results in the confused management of ministries and agencies. The Ministry of Trade has petitioned the Prime Minister to make the control of rice exports meet the factual demands and guarantees to consume the entire merchant rice amount with favourable prices for farmers.
Thus, the first change in the control of rice export in 2006 is that not only the Ministry of Agricultural and Rural Development but also the Ministry of Trade can calculate the total rice output and quantity of rice exports which the association and provinces will calculate and balance.
In 2006, the Prime Minister will decide on rice exports planned after ministries, associations and provinces hand in their balanced figures. In the short term, the Ministry of Trade has given directions to rice export enterprises to sign contracts to export about 4.5-5 million tonnes rice for the year 2006. To this end, in 2006 ministries and agencies will manage in accordance with the condition of factual rice supply source and inventory of enterprises. One expert of the Import and Export Department said “To meet the factual condition is ensuring to consume the entire merchant rice amount with favourable prices for farmers, keeping food prices in the domestic market stable and strictly abiding by engagements that enterprises signed with foreign partners.
In fact, in 2005 ministries and agencies operated in this way making progress in rice exports, in which the delivery schedule was in harvest months (of both winter - spring crop and summer – autumn crop). This meant the rice price in 2005 remained high and beneficial for farmers (at that time rice price was around VND2,000 per a kilogram)
The Ministry of Trade estimated that, by the first quarter of 2006, the export rice control would ensure the domestic consumption and keep rice prices for farmers. Including 280,000 tonnes of inventory of 2005 to be transferred to this year, the total rice exports in January 2006 was about 630,000 tonnes.
However, to stabilize the domestic rice price, especially in the time between winter - spring crop and summer – autumn crop and the Lunar New Year holiday, the Prime Minister asked ministries, agencies and enterprises in January and February 2006 to deliver on contracts which have matured and only with a medium amount.
Experts think that the rice trade in 2006 will continue benefiting exporting countries. In 2006, the world rice consumption will not be lower than 25.4 million tonnes. Africa and Asia are the largest importers of rice. Vietnam, Pakistan, India and Thailand are forecast to reduce rice exports. The rice reserve of Thailand is at 1.5 million tonnes at this time. This amount is out of the nine million tonnes of rice that the Thai government planned to buy on the Price Intervention Programme 2005 to be from September 1st 2005 to February 2006.
In Vietnam, the problem is that ministries and agencies cannot interfere in the business of enterprises but can regulate to guarantee food security and stabilize domestic rice prices, so enterprises have to calculate to export at a high price, not only in large amounts.
Kim Phuong
Vietnamese
