Profile change boosts rice export

The shift in rice export from low- to mid- and high-quality helped the rice export industry fare better in 2020. Yet much has to be done to maintain achievements.

Profile change boosts rice export
When it comes to market, in addition to making full use of opportunities in existing export markets, especially in the context of the Covid-19 pandemic, the rice export sector should get the most out of new markets, including the United States, Europe and signatories in free trade agreements Vietnam has signed. – Photo: Le Hoang Vu

Reports by the Ministry of Agriculture and Rural Development show that by the end of 2020, Vietnam’s rice export had reached 6.15 million tons earning sales of over US$3 billion. Although the total export volume dropped 3.5% compared with 2019, its value rose 9.3% year-on-year. The encouraging results are ascribable to the change in low- to mid- and high-quality rice, which also renders Vietnamese rice more competitive than before against its rivals, which are top rice exporters—such as Thai, Indian and Pakistani rice.

The export rice profile in 2020 saw the following change. White rice shipments fell by 15% in volume while those of fragrant rice increased by 3.6%, glutinous rice mounted by 122.5%, brown rice and organic rice skyrocketed by 165.2%, according to statistics released by the General Department of Vietnam Customs.

Nguyen Trung Kien, vice president cum general secretary of the Vietnam Food Association (VFA), said beside the objective factor due to the increase in world market rice prices in the context of Covid-19, the change in rice strains which has improved rice quality in recent years has prompted buyers to accept Vietnamese rice at higher prices.

Even Vietnam’s 5% or 25% broken rice has sold at over US$500 per ton, US$100 higher than India’s 5% broken rice. According to Nguyen Van Thanh, director of Phuong Thanh IV Production - Trading Co., Vietnam’s 5% broken rice is from OM 5451 or OM 18 rice strains, which have higher quality than that of the IR 50404 strain, which was once popular in Vietnam. Meanwhile, Indian and Pakistani 5% broken rice is still from rice strains of lower quality. The OM rice strain that produce 5% broken rice in Vietnam has long, white and soft grains suiting the taste of the Chinese, Malaysian, Indonesian and even customers in the Middle East, said Mr. Thanh. On the other hand, Indian 5% broken rice grains are short, opaque and not soft (similar to Vietnam’s IR 50404 strain). Versus Thai rice, prices of Vietnamese rice are more competitive in the same segment, while its quality is quite comparable.

Obviously, the shift in rice export helped Vietnam notch up certain success in 2020. Of course, Covid-19 also caused import markets to increase rice stock and prices on the world market to rise.

The increase in production of high-quality white rice and fragrant rice and specialty rice (from the strains of OM 5451, OM 18, Dai Thom, glutinous and Japanese rice, to name but a few) has led to the short supply of low-quality IR 50404 rice used in making pastry and noodles, and prompted rice import from India. This situation uplifted trading activities as well as prices of the IR 50404 rice strain in Vietnam. Local farmers benefited from it, too. 

To sustain the growth

 

The question to be answered is how Vietnam’s rice export sector can sustain the growth in 2021 in the context of the ongoing unpredictable Covid-19 ravaging the world.

According to Nguyen Trung Kien, VFA has set higher value for rice export for 2021. “To achieve that goal, in addition to promoting market development, it is necessary to focus on high quality products, the segment that has helped Vietnam’s rice industry to conquer the market in 2020,” he said.

Nguyen Quoc Toan, head of the Agroproduct Processing and Market Development Department under the Ministry of Agriculture and Rural Development, said when it comes to market, in addition to making full use of opportunities in existing export markets, especially in the context of the Covid-19 pandemic, the rice export sector should get the most out of new markets, including the United States, Europe and signatories in free trade agreements Vietnam has signed.

As regards rice production, the restructuring of the rice export profile should conform to the Prime Minister’s outline, which rules that production and processing entities must ensure food safety and hygiene; increase the value of high-quality products, such as organic rice; and standardize products to meet the world’s requirements and certifications, such as HACCP or Global GAP. “These are important certificates with which we can assert ourselves in the export market,” said Mr. Toan.

On the other hand, production cooperation among businesses and farmers need to be reviewed. A strong bond can create large production acreage, which offers quality and brings high value to export goods. “Finally, credit and financial institutions have to take part aggressively in agricultural enterprises,” he said.

Mr. Toan also noted another current problem related to logistics services—the need to quickly tackle the problem of shipping container shortage. “Mechanical engineering and manufacturing enterprises have to be involved to be able to provide enough containers so that Vietnam’s rice industry can become more competitive,” he said.  SGT

Over 200 traders licensed to export rice

Over 200 traders licensed to export rice

The Ministry of Industry and Trade’s Import and Export Department has released a list of 205 local traders nationwide who were certified as eligible to export rice as of January 18.

Q1 rice export outlook remains promising

Q1 rice export outlook remains promising

According to the Ministry of Agriculture and Rural Development, Vietnam’s rice output totalled 42.8 million tonnes in 2020

 
 

Other News

.
New money into stock market slows down, economy growth may miss expectations
New money into stock market slows down, economy growth may miss expectations
BUSINESSicon  16/07/2021 

In its recent report, Dragon Capital said that the market uptrend is still led by new individual investors.

Foreign retailers come, Vietnamese billionaires struggle to survive
Foreign retailers come, Vietnamese billionaires struggle to survive
FEATUREicon  16/07/2021 

The increasing presence of foreign giants has put great pressure on domestic retailers.

HCM City applies ‘production-and-quarantine’ model
HCM City applies ‘production-and-quarantine’ model
FEATUREicon  16/07/2021 

Many enterprises in HCM City are operating under a so-called production-and-quarantine model, i.e. maintaining production while strictly following quarantine rules amid the Covid-19 outbreak.

How to harmonize the two 'fronts'?
How to harmonize the two 'fronts'?
FEATUREicon  15/07/2021 

There must be satisfactory solutions for the sake of the economy and the country's reputation in international relations because the pressure to open up, for example, through accepting vaccine passports, is great.

Vietnam Airlines to raise over $346 million through share issuance
Vietnam Airlines to raise over $346 million through share issuance
BUSINESSicon  15/07/2021 

At the General Meeting of shareholders held on Wednesday morning, Vietnam Airlines JSC (HVN) approved a plan of raising VND8 trillion (US$346.2 million) through share issuance. 

Two updated scenarios put forward for Vietnamese economy until year’s end
Two updated scenarios put forward for Vietnamese economy until year’s end
BUSINESSicon  15/07/2021 

The Central Institute for Economic Management (CIEM) has revised two scenarios for the Vietnamese economy by the end of the year, with the GDP rate forecast to expand by 5.9% and 6.2%, respectively.

Businesses strive to maintain production amid lockdown in HCM City
Businesses strive to maintain production amid lockdown in HCM City
BUSINESSicon  15/07/2021 

When HCM City went into lockdown under Government Directive 16 on July 9, many businesses and manufacturers prepared plans to set up temporary accommodations for their workers to avoid the spread of coronavirus and maintain production.

Borrowing US$5 billion to invest in stocks: worries behind the record
Borrowing US$5 billion to invest in stocks: worries behind the record
FEATUREicon  15/07/2021 

The number of newly-opened securities accounts opened in the last 18 months is equal to the total number of the previous 20 years.

VIETNAM BUSINESS NEWS JULY 15
VIETNAM BUSINESS NEWS JULY 15
BUSINESSicon  15/07/2021 

The State Bank of Vietnam set the daily reference exchange rate at 23,203 VND per USD on July 15, down 1 VND from the previous day.

VN stock market hits record, big names rise
VN stock market hits record, big names rise
FEATUREicon  14/07/2021 

The Vietnamese stock market in the first half (H1) of 2021 broke many records.

Aviation sector eyes recovery in 2023-24
Aviation sector eyes recovery in 2023-24
BUSINESSicon  14/07/2021 

Vietnam's aviation market is hoped to recover in 2023-24, according to a Vietnam Airlines' representative.

Businesses ask banks to ease interest rates as promised
Businesses ask banks to ease interest rates as promised
FEATUREicon  15/07/2021 

Bank loan interest rates are becoming a heavy burden on businesses, which have been hit hard by Covid-19 for more than a year.

Exporters face slew of difficulties due to COVID
Exporters face slew of difficulties due to COVID
BUSINESSicon  14/07/2021 

Though exports remain strong, several sectors face difficulties due to the COVID-19 pandemic and require support from the Government if they are to sustain the growth, experts said.

Ministry proposes reduction in insurance deposits for travel firms
Ministry proposes reduction in insurance deposits for travel firms
BUSINESSicon  14/07/2021 

The Ministry of Culture, Sports and Tourism wants to reduce the value of insurance deposits by 80 per cent to help travel companies that are struggling because of COVID-19.

Mekong Delta: attractive destination for renewable energy development
Mekong Delta: attractive destination for renewable energy development
BUSINESSicon  14/07/2021 

Taking advantage of its natural conditions and investment attraction policies, the Cuu Long (Mekong) Delta has become a destination for investors in renewable energy projects.

Vaccine passport: certificate could save the tourism industry
Vaccine passport: certificate could save the tourism industry
FEATUREicon  14/07/2021 

The Covid-19 outbreaks have hit the tourism industry especially hard. Travel firms are looking forward to the new vaccine passport, which they believe could save the industry.

Banks agree to reduce lending interest rates from July
Banks agree to reduce lending interest rates from July
BUSINESSicon  14/07/2021 

Commercial banks have agreed to slash the lending interest rate in order to help businesses and people overcome the difficulties caused by the Covid-19 crisis.

Industrial real estate market hit hard by fourth Covid wave
Industrial real estate market hit hard by fourth Covid wave
FEATUREicon  14/07/2021 

The latest Covid-19 outbreak, which began in late April, has slowed down the industrial real estate market. There have been only small-scale projects and no large scale one announced.

Construction ministry gives opinion on transfer of part of multi-billion dollar super-project
Construction ministry gives opinion on transfer of part of multi-billion dollar super-project
FEATUREicon  14/07/2021 

The Hanoi Construction Department has sent a dispatch to the Ministry of Construction (MOC), asking for guidance on procedures that parties have to follow to transfer a part of the Ciputra urban area project.

Banks lending big to keep agriculture sector ticking
Banks lending big to keep agriculture sector ticking
BUSINESSicon  14/07/2021 

According to the State Bank of Vietnam’s department of credit for economic sectors, as of April credit injected into rural and agricultural development had reached VND2.3 quadrillion ($100 billion), or 24.6% of the banking sector’s total loans.

 
 
 
Leave your comment on an article

OR QUICK LOGIN