The sharp drop in rice export prices was beyond the forecast of many businesses. Market risks and the problem of not 'putting all your eggs in one basket' still remain valid.
Rice export prices fall below forecast
Export rice prices on February 11 increased slightly compared to the previous day, however, they are still below 400 USD/ton.
Specifically, the latest updated data from the Vietnam Food Association on February 11 shows that 5% broken rice for export is being offered at 397 USD/ton (up 1 USD/ton compared to the previous day); 25% broken rice is being offered at 372 USD/ton (up 2 USD/ton compared to the previous day); 100% broken rice is being offered at 310 USD/ton (unchanged compared to the previous day).
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| Rice export prices in early February 2025 fell to their lowest level in 9 years. |
Thai rice exports on February 11 slightly decreased. Specifically, 5% broken rice is being offered at 426 USD/ton (down 3 USD/ton compared to the previous day); 25% broken rice is being offered at 406 USD/ton (down 1 USD/ton compared to the previous day); 100% broken rice is being offered at 374 USD/ton (down 1 USD/ton compared to the previous day).
Although the gap between Vietnam and Thailand’s rice export prices has narrowed, Thailand’s rice export prices are still higher than Vietnam’s by 29-64 USD/ton, depending on the type. Vietnam’s rice export prices are also lower than India’s and Pakistan’s by 16-22 USD/ton and 4-28 USD/ton, depending on the type, respectively.
Thus, at less than 397 USD/ton, Vietnam's rice export price is 136 USD/ton lower than the previous price. 533 USD/ton was recorded on July 19, 2023 (before India issued a ban on rice exports). Compared to the peak price of 663 USD/ton at the end of November 2023, the export price of 5% broken rice has decreased by 264 USD/ton, equivalent to a decrease of 39.8%. Compared to the time when rice prices peaked, that is, in January 2024, 5% broken rice has decreased by about 260 USD/ton; 25% broken rice has also decreased by a similar amount; Jasmine fragrant rice has decreased by 150 USD/ton.
Changing the way of doing things to "keep a steady hand" in the face of "big waves"
The Ministry of Agriculture and Rural Development believes that in 2025, when India lifts its ban on rice exports, Indonesia - Vietnam's second largest rice export market - will be self-sufficient in food and will only import a small amount of rice depending on supply, which will affect Vietnam's rice exports.
The plunge in export rice prices has surprised many businesses. Mr. Pham Thai Binh, Chairman of the Board of Directors of Trung An High-Tech Agriculture Joint Stock Company (Can Tho) - informed that the inventories of traditional rice importing countries of Vietnam are relatively full, it is not the time to buy, while the information about abundant supply spreads, putting more pressure on rice prices.
However, many opinions say that currently, 3 traditional markets account for nearly 70% of Vietnam's total rice export turnover, but changes in policies of these markets will also quickly impact the Vietnamese rice market.
According to the Ministry of Agriculture and Rural Development, in 2024, the Philippines will be Vietnam's largest rice consumer market with a market share of 46.1%. Indonesia and Malaysia are the next two largest markets with market shares of 13.2% and 7.5%, respectively.
The question is why, in the context of decreasing rice export prices on the world market, the rate of decline in Vietnam's rice export prices is much faster than that of Thailand's rice export prices?
According to industry experts, the fact that rice exporting enterprises focus too much on a few markets that buy large quantities to "enjoy the difference per ton" (ie the more volume sold, the higher the profit) without focusing on value is the reason why the Vietnamese rice industry is heavily affected when risks occur.
The story of the sharp decline in rice export prices since the beginning of 2025 continues to pose the problem of market diversification to increase competitiveness for the rice industry.
The Ministry of Agriculture and Rural Development recommends that businesses should proactively diversify markets and types of exported rice, not only focusing on Asian markets such as the Philippines, Indonesia, China... but also expanding exports to other potential markets such as Europe, the US, the Middle East, West Asia and Africa.
In addition, localities need to focus on producing high-quality, high-priced rice varieties that are favored by the market, such as fragrant rice and specialty rice. In particular, focus on focusing resources on implementing the Project "Sustainable development of one million hectares of high-quality, low-emission rice cultivation associated with green growth in the Mekong Delta by 2030", to make Vietnam one of the pioneering countries in producing high-quality, low-emission rice in line with world consumption trends, while creating greater added value for Vietnamese rice grains.
There is no general formula for opening the market, each enterprise has its own strengths to do this. However, in addition to opening the market and ensuring quality, focusing on branding strategies, trade promotion, customer care... will be the way for rice exporting enterprises in particular, and the Vietnamese rice industry in general, to "keep a steady hand" in the face of "turbulent waves".
According to data from the Ministry of Agriculture and Rural Development, the average export price of rice in 2024 is estimated at 626.5 USD/ton, an increase of 9% compared to 2023. In particular, in the first quarter of 2024, the price of 5% broken rice was high at the beginning of the year, increasing sharply due to high demand from import markets, averaging about 623 USD/ton; in the second quarter of 2024, the price peaked in April at about 642.7 USD/ton but decreased sharply in May and June, reaching an average of about 572 USD/ton; in the third quarter of 2024, the price recovered slightly due to increased demand in the middle of the year at about 605 USD/ton; in the fourth quarter of 2024, the average price was about 628 USD/ton, maintaining a stable high level and increasing positively compared to 2023. |
Source: https://congthuong.vn/xuat-khau-gao-va-cau-chuyen-da-dang-hoa-thi-truong-373425.html
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