Strong demand from top importing countries and restricted supply has led to a spurt in Asian rice prices including Vietnamese export rice price that has hit a three-year high. According to the Ministry of Industry and Trade, the demand for Vietnam 5% broken rice has been rising, hitting US$390 per tonne in the first days of June, against US$360 – US$380 per tonne in late May. This is the highest price since December 2014, the ministry said, attributing it to the rising global demand for rice imports, especially in the Asian region. The export price rise has also led the paddy price in the domestic market to soar.
5% broken rice in the domestic market stood between VND7.65 million per tonne (US$340) and US$7.75 million in early June, up by VND550, 000 (US$24) per tonne against last month. The global rice market has been heating up after top importing countries, such as Bangladesh and the Philippines, announced to import roughly 950,000 tonnes of rice recently. Vietnam’s 5-percent broken rice RI- VNBKN5-P1 was quoted at a level unseen since December 2014, at $390 a tonne, FOB Saigon, up from $360-$380 last week, as suppliers looked forward to export deals, traders said. However, trade in Vietnam was thin despite higher prices as traders and farmers hold on to stocks expecting a further jump in prices. “People expect prices to rise to $400 and even more, so they don’t want to sell now. Traders want to wait and see,” said a trader based in Ho Chi Minh City.
Moreover Bangladesh last month said it would buy 250,000 – 300,000 tonnes of Vietnamese rice immediately and planned to increase its rice imports from Vietnam to 500,000 tonnes by the end of 2017. It has committed to buy one million tonnes of Vietnamese rice annually until 2022. The Philippines too is ready to issue a tender to import 250,000 tonnes of the rice and may up its imports to 1.5 – 1.6 million tonnes from key suppliers like Thailand, Vietnam and India. Other regional countries such as Malaysia and Indonesia also plan to import rice, while the demand for rice from China and Africa too is on the upward trend. Vietnam has lot to choose from in the coming months in terms of rice exports.