Rice exports in the first half of 2024 are forecast to continue to be positive.

“Scars” of Vietnam’s rice industry Naming the “weaknesses” of Vietnam’s rice industry

Vietnam's main rice export is still white rice.

According to the General Department of Customs, Vietnam's rice export output in the first 11 months of the year reached 7.8 million tons, earning a turnover of 4.4 billion USD. These are record numbers, the highest since 1989 and are expected to continue to increase in the coming time.

Rice exports in the first half of 2024 are forecast to continue to be positive.

The number one market for Vietnamese rice continues to be the Philippines, which currently accounts for about 35% of Vietnam's rice export market share. In the first 11 months of 2023, rice exports to this country reached 2.63 million tons, equivalent to 1.41 billion USD. Following are Indonesia, China and African countries.

Vietnam's rice export prices have been quite complicated since 2021. Specifically, in early 2021, rice prices reached 550 USD/ton, but by mid-2022, this figure dropped to nearly 460 USD/ton, then increased dramatically in 2023. The highest price was recorded in October 2023, reaching 640 USD/ton. In particular, some businesses can reach agreements close to the threshold of 800 USD/ton.

Mr. Le Thanh Hoa - Deputy Director of the Department of Processing Quality and Market Development (Ministry of Agriculture and Rural Development) - said that Vietnam's main rice export product is still white rice, accounting for more than 60% of the structure, and reaching more than 2.3 billion USD in value. Vietnamese rice is increasingly gaining brand recognition on the world map.

According to Mr. Le Thanh Hoa, global rice output could reach a record of nearly 520 million tons, while consumption is also approaching 525 million tons. Due to the decrease in global inventories, only over 160 million tons, this is a great opportunity for the Vietnamese rice industry.

“Import demand from countries will fluctuate. Some countries will decrease, such as Brazil, Egypt, Ghana... but some countries, including Vietnam's major trading partner - Indonesia - are forecast to increase by about 600,000 tons.

In addition, in 2023, the Philippines - another important partner of Vietnam - imported more than 2.8 million tons of rice, of which 90% of the volume was imported from Vietnam, 4.5% from Thailand reaching 126,560 tons, 4.3% from Myanmar reaching 120,538 tons, the rest came from Pakistan, India, and Cambodia," Mr. Hoa cited.

It is necessary to continue restructuring the rice industry towards improving quality and value.

Although the rice export market is forecasted to be positive, according to Mr. Nguyen Duy Thuan - General Director of Loc Troi Group Joint Stock Company, the biggest difficulty in implementing the rice value chain that the Group is currently facing is the source of money to buy rice when farmers are in the peak harvest season. In just a short time, businesses must manage to have enough money to buy all the rice output in the associated raw material area.

According to Mr. Thuan, each year Loc Troi Group exports about 700,000 tons of rice to the Philippines market. From there, Mr. Thuan proposed that the Philippines could cooperate and establish a financial company to provide capital for Loc Troi Group's rice chain, then receive it back with imported rice.

According to Mr. Thuan, enterprises are the bridge in the rice value chain, farmers produce and supply raw rice to enterprises, enterprises process and supply to the market. To create a chain, it is necessary to organize raw material areas, transfer production processes to farmers. Together, share benefits from the rice chain in a reasonable way, so that farmers can accompany and stick together for a long time. Ensure quality and brand reputation to maintain a stable export market.

Regarding the management agency, Mr. Le Thanh Hoa said that the rice market is currently undergoing a trend of transitioning to sustainable production, green development, and green consumption. In addition, the standards of the import market are increasingly demanding, and countries are increasingly raising measures and technical barriers to limit and control imported goods from abroad. Therefore, businesses are focusing on quality issues, instead of being overly concerned with productivity and output as in the past.

Forecasting the market at the end of the year and the first half of 2024, Mr. Le Thanh Hoa said that the situation will continue to be favorable. Therefore, he proposed to continue restructuring the rice industry towards improving quality and value, ensuring value increase rather than quantity increase.

Enterprises, cooperatives and people promote linkages in producing high-quality rice, shifting the structure and types of exported rice to diversify export markets, in line with the Strategy for developing Vietnam's rice export market to 2030.

Mr. Le Thanh Hoa also requested the Ministry of Industry and Trade to focus on researching and sharing market information; assessing and forecasting long-term demand and tastes; prioritizing resources for trade promotion, connecting trade, and promoting products to boost rice exports. At the same time, he requested the State Bank to ensure preferential credit sources for export enterprises, helping to ensure sustainable linkage chains.

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