On March 7, in Can Tho City, Deputy Prime Minister Tran Hong Ha chaired a conference on rice production and consumption and the drought and saline intrusion situation in the Mekong Delta in early 2025. Attending the conference were Minister of Agriculture and Environment Do Duc Duy and leaders of relevant ministries and branches; leaders of 13 provinces and cities in the Mekong Delta; industry associations, businesses, and scientists.
Solving the problem of purchasing reserves
On March 7, in Can Tho City, Deputy Prime Minister Tran Hong Ha chaired a conference on rice production and consumption and the drought and saline intrusion situation in the Mekong Delta in early 2025. Attending the conference were Minister of Agriculture and Environment Do Duc Duy, leaders of the Ministry of Agriculture and Environment and related ministries and branches; leaders of 13 provinces and cities in the Mekong Delta; industry associations, businesses, and scientists.
Moderating the discussion session at the Conference, Minister of Agriculture and Environment Do Duc Duy made some comments on the situation of rice production and consumption. He said that normally, rice export will face difficulties at the beginning of the year, leading to price fluctuations. Because at this time, rice importing countries calculate and consider whether to buy or sell, or balance the amount of purchases to reserve for stockpiling, so fluctuations in the rice market are inevitable.
On the other hand, in 2024, the rice market will experience major fluctuations, when India and Thailand will temporarily stop exporting. This will lead to some countries increasing their purchases due to concerns about instability, which will cause rice prices to spike, including Vietnamese rice.
Returning to the domestic market, Minister Do Duc Duy assessed that Vietnam's rice export output has remained stable for many years at around 7.5-8 million tons, without much fluctuation. On the other hand, localities have made great efforts to switch to high-quality rice (currently high-quality rice accounts for around 80-85% of the export market share), while low-quality rice has decreased. Therefore, in the market segment using high-quality goods, there have been no fluctuations, while the market using both high-quality and mid-range goods has adjusted.
Currently, Vietnam has crops spread out all year round, so when difficulties arise, they can only last for about 2-3 months. If we can solve the problem of purchasing in reserve while waiting for the market to stabilize, we will not encounter difficulties. This is an appropriate management and response solution in the current context.
Regarding the issue of rice prices falling, even falling sharply in some segments, Minister Do Duc Duy commented that rice prices are currently returning to the level of 2023, the time before the sudden price increase in 2024. Including the export price of rice, in the period 2022-2023, the average price was around 400 USD/ton, currently it is 530-540 USD/ton, although it has decreased compared to last year, it is still higher than the price level of 2023.
For example, the production cost of IR50404 rice is from 3,800-4,300 VND/kg, the purchase price is over 5,400 VND/kg; for high-quality rice varieties, the current purchase price is from 6,000 VND to over 7,000 VND per kilogram (depending on the type), this price level is not too worrying.
However, the Minister emphasized that there should be no complacency, because countries such as India, Thailand, and the Philippines are still adjusting their purchasing policies, including export policies. Therefore, businesses must “wait and see” to keep abreast of the situation and adapt to the adjustments of other countries.
“If we can keep the source stable for a quarter, then there will be no need to worry. To solve the problem within this quarter, small-scale enterprises should not sell off, keep purchasing stable as well as have solutions to stockpile, wait for the time when the market adjusts to stabilize before expanding exports,” the Minister of Agriculture and Environment analyzed.
The core solution that the head of the Ministry of Agriculture and Environment proposed and asked delegates to focus on discussing:
First, is to calculate the solution for the story of increasing the capacity of the warehouse system to purchase and store during peak times.
Second, the lending quota for businesses to purchase reserves is currently short, and the interest rate is not really attractive. Therefore, the State Bank and businesses need to clarify the need for credit capital to meet current reserve capacity.
Third, the issue of market control, according to the Prime Minister's Directive, clearly states that localities must strengthen inspection and examination; strictly handle cases of taking advantage of difficult times to force down farmers' prices.
Fourth, to stabilize the market in the long term, key export enterprises must have a chain of links with farmers, from production to purchasing, milling, processing, and exporting. That is, to form chains, enterprises must be large-scale, ensure capital capacity, warehouse systems, and have a system of "extended arms" such as cooperatives for purchasing and transportation.
Correctly assess the current status of rice production and consumption
Proposing solutions to overcome the above difficulties, Mr. Nguyen Ngoc Nam - Chairman of the Vietnam Food Association (VFA) - said that in 2023, Vietnam will export over 8 million tons, and in 2024, it will reach about 9 tons. This affirms that Vietnamese enterprises have proactively sought markets, and the amount of rice produced is not concerned about consumption.
Mr. Nam proposed that the State Bank expand capital sources and extend loan terms for businesses to purchase reserves, while removing obstacles in VAT refunds.
The Southern Food Company (Vinafood II) - the unit that just won the bid to sell 100 thousand tons of rice to Bangladesh - also proposed to step up the purchase of winter-spring rice reserves. According to Mr. Tran Tan Duc - General Director of Vinafood II, every year, the National Reserve Department purchases 80-100 thousand tons of rice, combined with Vinafood II's order to supply Bangladesh, this is the most appropriate time to purchase, thereby boosting prices.
From another perspective, Mr. Le Thanh Tung - Permanent Vice President of the Vietnam Rice Industry Association - said that currently, there is a lot of information on rice production and trade, but it does not meet the needs of localities, businesses and farmers; information updates are often slow. To improve this problem, the Vietnam Rice Industry Association is ready to design and accompany the information focal points under the Ministry to provide and transfer all information to businesses and localities in a more timely manner, especially in the process of implementing the 1 million hectares of high-quality rice project.
After listening to opinions and discussing solutions from associations, businesses, a number of localities and relevant ministries, Deputy Prime Minister Tran Hong Ha said that in 2023-2024, the world market will have major fluctuations in a direction that is beneficial to farmers and our country has made the right decisions, which is to continue exporting.
To improve market management and regulation capacity, the Deputy Prime Minister requested the Ministry of Agriculture and Environment to urgently build a comprehensive specialized database system. This system will integrate information from many stages: production, science and technology, processing, preservation, market and forecasting, in order to provide timely and accurate information to relevant parties.
Regarding export management, the Deputy Prime Minister requested the Ministry of Industry and Trade to promptly inspect and correctly assess the current situation of the domestic rice market. At the same time, amend and supplement Decree 107/2018/ND-CP with important adjustments. Enterprises wishing to be granted export licenses must meet strict criteria. For example, production linkage capacity, warehouse system and financial capacity. This solution is expected to improve the quality and professionalism of rice exports.
Giving further instructions on the issue of building and protecting rice brands, the Deputy Prime Minister requested the Ministry of Agriculture and Environment to coordinate with the Ministry of Science and Technology to develop a strategy to prevent other countries from illegally using the Vietnamese rice brand; establish the position and protect the reputation of Vietnamese rice in the international market.
Regarding agricultural land, the Deputy Prime Minister suggested a thorough review and focus on developing areas with high productivity and good adaptability to climate change. Localities can adjust from 3 crops/year to 1-2 crops/year to improve production quality.
Thanks to advantages in natural conditions, application of science and technology and human factors, Deputy Prime Minister Tran Hong Ha believes that Vietnamese agriculture can compete strongly in the international market.
The Deputy Prime Minister also requested the Ministry of Finance and the State Bank of Vietnam to urgently calculate and review tax and credit policies to create maximum conditions for people and businesses in the rice industry chain to improve their capacity, take advantage of and develop the full potential and advantages of the Vietnamese rice industry.
Source: https://baotainguyenmoitruong.vn/pho-thu-tuong-tran-hong-ha-nang-chat-luong-tinh-chuyen-nghiep-trong-xuat-khau-gao-387386.html
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