According to Vietnam Food Association (VFA), domestic rice exporters in the first quarter of 2018 will ship some 630,000 tons of rice that they signed export contracts for last year.
Vietnam’s rice export prospects have been optimistic right from the beginning of the year
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Meanwhile, the global demand for rice is forecast to rise sharply this year. According to the United States Department of Agriculture (USDA)’s 2018 world rice production forecast issued in late 2017, the main factor behind this year’s rice trade expansion is increased output from Vietnam, Pakistan, and Myanmar, three of the world’s Top 6 rice exporting countries.
The USDA report stated that though global rice output fell by 20% in 2017 against 2016, as a result of weak outlook for grain products, long, heavy rainfalls, spring floods, and other unfavorable weather phenomena, traditional rice importing markets in Southeast Asia are looking at bright prospects in early 2018.
In Bangladesh and Sri Lanka, where rice crops were heavily influenced by harsh weather, demand for rice imports will also increase in 2018. Rising import demand is supported by increased purchasing power in Africa and the Middle East, while China continues to be a leading importer of rice from neighboring regions.
Vietnam, therefore, will witness increasing revenue from rice exports to several large consumer markets.
Nguyen Thanh Long, director of Gao Viet Company, also thinks that rice exports will improve in the first quarter of 2018 if supply is sufficient. The harvest time in several countries like Pakistan and Myanmar already passed, while Thailand may harvest late by a month.
Thanks to the rising market demand, Vietnamese rice exports in the first month of the year surged by 56.5% to 524,000 tons, earning the country US$249 million, up 74.2% year-on-year. The price of Vietnamese rice surged by $45 in January to $420-430 per ton.
VFA forecast that Vietnam’s rice exports this year will reach some 6 million tons, up 400,000 tons against 2017 thanks to rising demands from China and Southeast Asian markets, such as the Philippines and Indonesia.
VFA said Indonesia will import rice from Vietnam and Thailand again in 2018 to increase reserves, as domestic prices have been rising to almost double the floor price.
Similarly, National Food Board of the Philippines approved to import up to 250,000 tons of rice to offset declining inventories due to unfavorable weather conditions in 2017.
However, local firms still need to improve to meet food hygiene and safety requirements and formulate better strategies to compete with India or Pakistan in the African markets, VFA said.
As of January 11, cities and provinces in the Mekong Delta region—Vietnam’s rice granary—harvested 2017 autumn-winter rice on 860,000 hectares and planted 1.35 million hectares of the winter-spring 2017-2018 crop.
The Vietnamese rice export industry had a successful year in 2017. According to VFA, local businesses exported nearly 5.8 billion tons of rice last year, earning $2.5 billion in revenue. Vietnam has exported rice to 132 markets in the world and China remains Vietnam's biggest buyer.
