Vietnam was estimated to ship more than 1.1 million tons of rice abroad in the first quarter of the year, raking in US$306 million, up 4.9 per cent in volume and 7.3 per cent in value against the same period last year, according to the Government Statistics Office.
The statistics also showed that the country fetched up more than US$139 million from exporting an estimated quantity of 500,000 tons of rice in March alone, up 34 per cent in value and 60 per cent in volume as compared to figures from the previous month.
Domestic enterprises have to date signed contracts to export 2.4 million tons of rice scheduled to be delivered before June, the Ministry of Trade (MoT) reported.
The ministry said that Vietnam mainly exported low-grade rice, which amounted to 48.57 per cent of total rice exports, while medium-grade rice was 25.54 per cent and high-grade rice only 19.48 per cent. Asia remains the biggest export market for Vietnam, consuming 75.24 per cent of total rice exports.
Export prices have been lower in recent deals, especially since March 2006. Importers have placed orders at low levels, anticipating that the price would further decrease. Meanwhile, some Vietnamese exporters have had to sign export contracts at low prices, as they have to sell rice soon to recover capital to pay debts.
The price of 5 per cent broken rice contracted in January and February was between US$258 and US$260 per ton, it decreased to US$245-250 per ton in early March and to US$240-242 per ton in mid March. Economists forecast another decrease of US$3-7 per ton at the end of March, when Vietnam enters the peak harvest, before it bounces back in April.
Rice prices are at low levels. Paddy prices in some southern provinces have seen a sharp decrease of VND2,000 per kilo, while in northern provinces, prices have stayed firm.
The world’s market is forecast to heat up this year due to bad weather and high demand for rice imports. The Vietnam Food Association (Vietfood) has advised local exporters not to make hasty contracts at low prices, while requesting that the Government give financial support so that the enterprises can keep export prices at high levels.
The Government has set a target of 5 million tons of rice exports. The management authorities have asked local authorities and Vietfood to strictly supervise export activities to prevent any unfavorable export deals.
In 2005, Vietnam exported 5.2 million tons of rice worth US$1.4 billion, increasing by 27 per cent and 47 per cent over the previous years. Vietnam's rice export prices are still at low levels as Vietnam has no well known brand names.
At present, Vietnam and Thailand have the largest amount of five-percent-broken rice available on the international market. Thai rice prices are still high at present due to support from the Thai government. Vietnam Economic Times, Liberated Saigon
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