Global Rice News

Rice Trade between Vietnam and the Philippines Forecasted to Remain Steady

The rice trade between Vietnam and the Philippines is expected to maintain stability in the coming months, according to the Vietnam Trade Office in the Philippines. While the Philippine Government is implementing changes to its National Food Authority (NFA) and considering modifications to rice import regulations, these adjustments are not anticipated to have an immediate significant impact on Vietnamese exports, stated the trade office.

The restructuring of the NFA aims to empower the agency to intervene directly in the rice market and stabilize prices. Furthermore, lawmakers are contemplating revisions to Republic Act No. 11203, which liberalized rice trade in the Philippines. These measures are in response to the escalating rice prices in the country, which have contributed to inflation. Previous efforts by the Government, such as price ceilings, have proven ineffective in curbing the price surge.

The Vietnam Trade Office emphasized that the NFA’s intervention efforts mainly target lower-quality rice consumed by low-income Filipinos, and therefore, would not disrupt the premium rice market where Vietnamese exporters hold a strong position.

Statistics reveal Vietnam’s dominance in the Philippine rice market. During the first five months of this year, Vietnam remained the top supplier of rice to the Philippines, accounting for over 72% of the country’s total rice imports. The popularity of Vietnamese rice varieties such as DT8 and 5451, known for their softness and affordability, explains this preference. Vietnamese rice is highly regarded in Metro Manila and southern localities for its taste and competitive pricing.

Vietnamese rice meets Philippine preferences with its quality, variety, and competitive prices, stated Phung Van Thanh, Trade Counsellor of the Vietnam Trade Office in the Philippines. The consistent supply, both in terms of volume and price, perfectly aligns with the Philippines’ annual import requirements. Geographical proximity also translates to cost-effective transportation.

In addition to these factors, Vietnamese rice benefits from trade advantages under bilateral and multilateral agreements such as the ASEAN Trade in Goods Agreement (ATIGA) and the Regional Comprehensive Economic Partnership (RCEP). These agreements offer benefits not available to non-ASEAN rice exporters like India and Pakistan.

Looking forward, Thanh advised Vietnamese rice exporters to maintain their top position in the Philippines. This can be achieved through continued collaboration with the Ministry of Industry and Trade and Vietnamese authorities in the Philippines, such as the Embassy and Trade Office, to organize promotional events. Thanh also suggested exploring the potential of medium- and lower-quality rice to cater to a broader range of Philippine consumers.

Source: Krishak Jagat