(People’s Daily) In the first two months of 2021, although the value of rice exports has fallen sharply, the global demand for rice is expected to continue to increase. In addition, domestic production capacity has maintained a good momentum, and the quality of rice has also been continuously improved. This is an important basis for companies to expect that rice exports will pick up as soon as possible, and the export value will exceed the level of 3.1 billion US dollars in 2020.
The demand is high but the export volume is still declining
According to data from the General Administration of Customs, in January 2021, Vietnam’s rice exports and exports reached 347,774 tons and 191 million U.S. dollars, respectively, down 36.4%and 34.2%compared with December 2020, and down 15.4%year on year And 2.4%. February 2021 coincides with the Spring Festival holiday, and the progress of orders is slow, and companies predict that rice exports will continue to decline.
Nguyen Van Don, manager of Tien Giang Province Viet Hing Co., Ltd., said that the beginning of the year was not the peak period of import and export activities because customers had already proactively purchased reserves for long holidays. In addition, the winter and spring rice has not yet entered the harvest season, so the company’s purchase of rice is not high. In addition, the price of rice in the Jiulong River Delta has risen, causing buyers and foreign customers to wait for the price to cool down.
Fan Taiping, general manager of Zhongan High-tech Agriculture Company in Can Tho City, believes that transportation difficulties are also one of the reasons for the decline in rice exports in the first few months of 2021. From the end of 2020 to the present, the shortage of empty containers has not shown any signs of improvement, and the freight has increased by 2-3 times compared with before, which has caused many difficulties for many import and export enterprises.
The Vietnam Food Association predicts that rice export activities will pick up in 2021. Specifically, major export markets such as the Philippines and other Southeast Asian countries, and African countries continue to sign rice purchase and sales contracts with Vietnam. Potential customers such as China and Bangladesh are actively buying rice, which has revived the Asian rice market. Many countries have great demand for Vietnamese superior products such as fragrant rice and glutinous rice.
Vice Chairman and Secretary General of the Vietnam Food Association Nguyen Tsung Kien revealed that in addition to the positive developments mentioned above, Vietnamese rice still has the opportunity to enter the market where the free trade agreement has been signed with Vietnam. Within the framework of the Free Trade Agreement between Vietnam and the Asia-Europe Economic Union, the countries of the Eurasian Economic Union pledged to provide Vietnam with an annual export quota of 10,000 tons of rice. According to the”Vietnam-EU Free Trade Agreement”, the European Union provides Vietnam with an annual export quota of 80,000 tons of rice. In addition, the”Vietnam-UK Free Trade Agreement” came into effect at the beginning of 2021, and it also grants zero-tariff treatment to Vietnamese rice and is not subject to quota restrictions.
Chung An High-Tech Agriculture Company General Manager Fan Taiping confirmed that with the continued increase in world demand and the continuous improvement of domestic rice production capacity, Vietnam’s rice export activities this year will be smoother than last year. From the end of February to mid-March of 2021, the winter and spring rice will enter the harvest season, and the supply of rice will be more abundant. In terms of export prices, in January 2021, the average export price of Vietnamese rice was US$550/ton, an increase of 3.4%month-on-month and an increase of more than 15%year-on-year. However, the average export price of Vietnamese rice is still lower than the price of rice of the same quality in other countries.
Mr. Nguyen Van Don believes that it is easy to understand that the export price of rice rises as the quality of rice rises. However, in order to maintain market share in various traditional markets and better enter the high-end EU market, the rice industry needs to ensure uniform quality, effectively control the supply chain and product traceability. In addition to rice, companies also need to study deep processing to produce products with high added value, thereby improving economic efficiency and establishing a brand for the Vietnamese rice industry. (End)