Export rice price falls below 600 USD/ton, businesses should buy for reserve

Continuously decreasing, falling below 600 USD/ton

According to the Vietnam Food Association (VFA), in just the last two days of February, the export price of Vietnam’s 5% broken rice decreased by a total of $13 per ton. The adjusted price has now fallen to $594 per ton.

Experts say businesses should buy reserves at this time.

Thus, in just the last 2 weeks of February, the export price of rice has continuously decreased sharply by 43 USD/ton compared to the beginning of February and decreased by 69 USD compared to the peak of 663 USD/ton in December 2023.

According to data from VFA, in the last days of February 2024, not only Vietnamese rice but also the prices of rice of the same grade from countries including Thailand and Pakistan also recorded a decrease. In particular, the price of 5% broken rice from Thailand is currently at 609 USD/ton (down 32 USD/ton compared to early February 2024), while the price of rice of the same grade from Pakistan is currently at 606 USD/ton (down 24 USD/ton compared to early February 2024).

According to VFA, the decrease in rice prices in many countries is due to the harvest season, abundant supply, so importers are looking to delay placing orders. Specifically, in Vietnam, the provinces in the Mekong Delta (Vietnam's largest rice granary) are in the winter-spring harvest season.

Meanwhile, in Thailand, white rice prices fell due to quiet new demand while more commercial rice supplies arrived.

The Thai Rice Exporters Association (TREA) has recently urged the government to intervene in the exchange rate issue to help support the competitiveness of Thai rice in the world rice trade market, VFA said. At the same time, TREA also emphasized the role of developing new rice varieties to increase production and surplus for export.

The decrease in export rice prices has affected domestic rice prices. Accordingly, rice prices in the Mekong Delta provinces have decreased by 1,000-2,000 VND/kg compared to the time before Tet. The decrease has now stopped, but because localities in this region are in the main harvest period, farmers are concerned that the decrease in export prices will further reduce rice prices.

Should businesses buy reserves?

Although rice prices are falling, experts say that businesses with financial potential should buy to "take advantage" of good prices. According to experts, the balance of global rice supply and demand in 2024 shows that sellers still have the initiative (currently demand is still greater than supply).

Specifically, according to the forecast of the United States Department of Agriculture (USDA), the world will have a shortage of about 8.6 million tons of rice in 2024. The leading importing countries are the Philippines, Indonesia, China... Of which, the Philippines is forecast to import a record 3.8 million tons; Indonesia about 3.6 million tons...

As for exporters, India continues to restrict rice exports, while Thailand recently forecast that it will reduce its export volume this year due to the impact of climate change. Accordingly, the Thai Ministry of Commerce and the Thai Rice Exporters Association (TREA) recently shared the same forecast that Thai rice exports in 2024 will be about 14.38% lower than in 2023, at 7.5 million tons, due to an expected 5.9% decrease in the 2024 harvest.

Previously, according to data from the Thai Ministry of Commerce, Thailand's total exports for the whole year of 2023 reached 8.76 million tons of rice of all kinds, an increase of 13.7% compared to 2022. In January 2024, Thai rice exports reached 1.12 million tons, an increase of 44% compared to the same period in 2023 and 37% compared to December 2023.

Source: https://congthuong.vn/gia-gao-xuat-khau-lui-ve-duoi-600-usdtan-doanh-nghiep-nen-mua-du-tru-306118.html