Expert advises businesses to remain cautious despite record high rice exports
Published on: November 3, 2023.
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Vietnam Food Association (VFA) and BizLIVE recently co-organized a workshop to assess the rice market and make predictions for the coming year. The annual conference, titled “Solutions to Improve the Efficiency of Vietnam’s Rice Value Chain,” brought together representatives from VFA, the Ministry of Agriculture and Rural Development, and rice providers and exporters from the Mekong Delta region. The conference mainly focused on cost optimization, increasing profitability in the rice value chain, and securing effective capital sources for the rice industry.
According to the Ministry of Industry and Trade, Vietnam has exported approximately 7.1 million tons of rice, generating a turnover of nearly US$4 billion in the first ten months of 2023. This marks a 17% increase in volume and a 35% increase in value compared to the same period in 2022. Notably, Vietnamese rice prices remain the highest among rice-exporting countries. Five percent broken rice is being traded at US$653 per ton, while 25 percent broken rice is priced at US$638 per ton, surpassing Thailand and Pakistan.
The surging price of rice is attributed to factors within the supply chain. Export enterprises are facing challenges in shipments, as contracts typically require a delivery time of one to three months. Some rice businesses have even had to cancel contracts due to losses caused by the high price of Vietnamese rice. However, larger enterprises are compelled to maintain their reputation by purchasing rice at higher prices to fulfill their contracts.
Additionally, the price increase can be attributed to suppliers who raise prices whenever the price of rice surges. Vice President of VFA, Do Ha Nam, emphasized that although a high rice price may seem advantageous, customers may look for alternative markets with the same quality rice, such as Thailand.
Discussion during the conference also focused on technological solutions and obtaining capital for the rice sector. Rice experts anticipate that Vietnamese rice exports in 2023 could reach a new record high of eight million tonnes. To achieve success in rice exportation in 2024, enterprises are advised to be patient when signing long-term contracts due to the limited rice supply and challenges related to credit packages.
In conclusion, the workshop provided valuable insights into the current state of the rice market in Vietnam and offered potential strategies for improving the efficiency of the rice value chain. With careful planning and consideration of various factors, the rice industry has the potential to continue thriving in the coming years.
**Source:** [Vietnam Food Association and BizLIVE Workshop](https://en.sggp.org.vn)
