The director of a rice export company, who did not want to be named, told Thanh Nien that even if businesses purchased rice from farmers as requested by the food association, prices would not improve much.
"When there is a bumper crop, rice prices drop immediately," the director said, noting rice of the summer-autumn crop was usually unfavorable by foreign importers because of its lower quality compared to other harvests.
Nguyen Van Minh, deputy general director of the Hau Giang Food Joint Stock Company, said that although his company agreed to pay VND3,800-3,900 per kilogram, such prices were for high-quality rice only and farmers had to transport the rice to the company factory on their own. As many farmers didn't have high-quality varieties, and others couldn't transport the grain properly, Minh said he couldn't buy large volumes of rice at good prices.
Nguyen Dang Chi, deputy director general of the Import-Export Department at the Ministry of Industry and Trade, said falling global demand this year – two million tons less than last year – has pushed rice prices down.
Many other countries have reported bumper crops and others are using their old stockpiles, so demand is not high, Chi said in an interview with Tuoi Tre newspaper on Monday.
Chi also said local exporters were undercutting each other, driving prices even lower.
"When some exporters set their profit margin at US$3 per ton, others set theirs at only $2 or even just a mere $1 per ton. Foreign importers have taken advantage of the lack of teamwork to force prices down."
Chi said his ministry was drafting a decree to tighten control over rice trading.
The Vietnam Food Association said it plans to purchase another 500,000 tons this month to stabilize prices for farmers as soon as possible.
But foreign experts said low prices have helped Vietnamese rice do well on the global market.
Vietnam shipped 4.7 million tons of rice in the first eight months of the year, 43 percent more than a year earlier, according to preliminary estimates from the General Statistics Office in Hanoi. Exports totaled 4.65 million tons last year and reached a record 5.17 million tons in 2005.
Vietnam may boost shipments this year by as much as 49 percent to seven million tons thanks to an improved harvest, Deputy Minister of Industry and Trade Do Huu Hao said in August.
"Vietnam's price quotes are well below Thailand's, making Vietnam a very competitive supplier," Nathan Childs and Katherine Baldwin of the US Agriculture Department wrote in an August 13 report, according to Bloomberg.
Vietnam has also taken some market share from Thailand, whose shipments of white rice are trailing behind last year's pace by about a third, the agricultural attaché's office at the US embassy in Bangkok said in a report August.
Current export demand for Thailand's white rice remains quiet as "foreign buyers are sourcing Vietnamese rice, which is over $100 per metric ton cheaper," Bloomberg reported, citing an August 25 note by Ponnarong Prasertsri, an agricultural specialist at the US embassy in Bangkok.
"Number one is that you have to have the availability, and Vietnam is producing more," said Mamadou Ciss, chief executive of Singapore-based rice brokers Hermes Investments Pte Ltd.
The rice area planted for the autumn-winter crop has been increased in size over the last season, Quan Tran of the agricultural attaché's office at the US embassy in Vietnam wrote in a report released on September 4.
The autumn-winter crop would be Vietnam's most important rice crop this year, the Vietnam Food Association said in a July report, citing the Ministry of Agriculture and Rural Development.
Overall, Vietnam's paddy output would total 36 million tons this year compared with a previous estimate of 35.9 million, according to the American embassy in Vietnam.
No comments:
Post a Comment