Rice export: vietnam needs to wait or take actions to grab opportunities?
VietNamNet Bridge – Thailand has been “holding out.” India and Pakistan hasbeen actively negotiating with partners to boost exports. What should Vietnamdo: keeping waiting or taking actions to grab the opportunities?
The world and the domestic rice markets both have been fluctuating when big riceimporters in the world have placed orders with Indian and Pakistani exportersinstead of the Vietnamese, and Thai because Indian and Pakistani exporters offerlower prices.
Meanwhile, the plan by the Thai government to buy rice from farmers at highprices implemented since October 7 has been meeting a lot of difficulties due tothe worst flood in the last 50 years. As a result, the world’s rice price hasnot increased as expected by other big rice exporters, including Vietnam.
Vietnam: keep waiting or “jump”?
Rice experts once predicted that the Thai government’s policy to intervene thedomestic rice market would push the rice export price to 700-850 dollars perton. However, the world market has not been performing this way, becauseThailand is bearing the worst flood in the last 50 years. At present, the exportprices offered by export countries are still lower by 100-250 dollars per tonthan the expected level.
The export prices offered by Vietnam and Thailand are still at 570-580 dollarsper ton and 600-610 dollars per ton, respectively.
The export resumption of India, the biggest rice producer in the world (but notthe biggest exporter) has had big influences on the world market.
Vietnamese rice exporters are still wavering between keeping waiting for thebetter news to come from Thailand, or boosting exports in the stiff competitionwith India and Pakistan.
If Vietnamese exporters keep waiting, hoping that the export price wouldincrease in the near future and decide not to sign contracts right now, they maymiss the opportunities. Meanwhile, if they boost exports right now, they mayregret later, if the export prices go up.
At a meeting held recently in HCM City, Nguyen Trung Kien, Deputy Chair of theVietnam Food Association (VFA), admitted that though Vietnam’s export priceshave big influences to the world market, it will not be able to say exactlyabout the price prospect until the end of November, by that time, Vietnameseexporters will be able to know exactly whether they should go ahead and signexport contracts.
However, when answering the questions at the regular meeting held by theMinistry of Industry and Trade on October 7, Deputy Chair of VFA Pham Van Baysaid he believes the export prices would stay firmly at high levels.
Meanwhile, VFA has advised rice exporters to sign agreements with Indonesia andbuild up relationships with Malaysia on rice export. The association has alsoadvised farmers to harvest the crop soon in order to have best sale prices.
Domestic prices stay firmly high
Contrary predictions about the market prospect make rice traders puzzled. ThanhPhong, Director of Van Loi 2, a rice husking and trade company in Tien Giangprovince said, at first he heard that the market would be gloomy in the nextyear, and then he was told that the rice price would go up. Therefore, he cannotdo anything at this moment, except waiting and listening for the news.
Meanwhile, a lot of companies have decided to store rice, believing that theprice would stay firmly high. “I strongly believe that the rice price would bestably high the next year, because Vietnam has signed the contracts on exporting800-900,000 tons which will be delivered in the first months of 2012,” said VoThanh Son, a merchant at Ba Dac Market in Cai Be district of Tien Giangprovince.
Other merchants at the Ba Dac market have also affirmed that the rice price inthe Mekong Delta has been staying high. Fresh IR 50404 rice can be sold at6400-6500 dong per kilo in Dong Thap and An Giang provinces, while dried IR50404 is traded at 7500 dong per kilo.
Meanwhile, merchants pay 7800 dong per kilo for long grain rice including OM4218, OM 5451, OM 1490.
Source: TBKTSG
