Latest forecast on rice prices from now until the end of the year

Export rice prices have not been affected in the short term.

According to preliminary statistics from the General Department of Customs, in the first 8 months of the year, rice exports reached more than 6,15 million tons, bringing in 3,85 billion USD. Compared to the same period last year, it increased by 5,8% in volume and 21,7% in value. Rice exports increased slightly in volume but increased sharply in value due to the average export price of rice increasing by 14,8% compared to the same period in 2023, to 625 USD/ton.

Latest forecast on rice prices from now until the end of the year. (Photo: NH)

The top main export markets for Vietnamese rice are: Philippines, Indonesia, Malaysia and China. In the first 8 months of 2024, Vietnam's rice exports to Indonesia reached 913,888 thousand tons, worth 557,77 million USD, compared to the same period in 2023, an increase of 27,26% in volume and 54,40% in value, accounting for 14,85% of the country's total rice exports.

In the first 8 months of 2024, rice exports to the Malaysian market reached 582,872 thousand tons, worth 346 million USD, an increase of 2,12 times in volume and 2,53 times in value over the same period last year.

Rice market world and the country received new information recently (13/9), according to a decree of Goverment, India has removed the floor price for basmati rice exports in a bid to boost exports of the grain, which farmers are struggling with debt and rising costs, just weeks before the new harvest. Last year, India set the floor price, or minimum export price, at $1.200 a tonne and later lowered it to $950 a tonne.

With the Indian Government’s moves to loosen rice exports, the question is how will this affect the operations of Vietnamese export enterprises, as well as domestic rice prices? Some opinions say that any move to loosen rice exports by India will cause rice prices in the international market to drop significantly. However, for now, Vietnamese rice will not be affected much.

Talking to reporters of Industry and Trade Newspaper, Mr. Do Ha Nam – Vice President of Vietnam Food Association - said that this will have little impact on the price of Vietnamese rice. Because this is low-quality rice, mainly consumed in the African market area.

Even if India lifts the ban on rice exports, Mr. Do Ha Nam assessed that this would not have much impact on domestic rice export prices. Because Indian rice varieties are different from those of Vietnam. Indian rice is mainly low-grade rice and exported to African markets. Meanwhile, in Vietnam, most of the acreage has been converted to grow high-quality rice varieties and other export market segments of India.

Sharing the same view on this issue, Mr. Nguyen Van Thanh - Director of Phuoc Thanh 4 Production and Trading Company Limited - said that if India reopens the low-grade rice market, Vietnamese rice will not be affected much in the short term, even the Autumn-Winter crop that the Mekong Delta is about to sow will not be significantly affected, because about 60 - 70% of the rice crop area is planted by farmers with high-quality rice varieties, such as RVT, ST21 and ST25 for domestic consumption and preparation for the upcoming Tet rice. The rest is sold to markets such as the Philippines, China, the Middle East and the EU.

What is the assessment for rice export prices from now until the end of the year?

Mr. Do Ha Nam shared that the price of paddy and domestic rice has been increasing continuously over the past week. In addition to the impact of storms and rains on rice supply from now until the end of the year, the export contracts that businesses have signed are very large, the export price of rice is signed at a low price, so businesses try to wait to buy at a low price. However, after waiting for a while, businesses are forced to buy rice to pay for orders signed with partners.

“Recently, there has been a lot of information about low rice prices, which has put pressure on domestic businesses. However, businesses are currently worried about the supply of goods for signed orders, so they are not too concerned about new orders,” Mr. Do Ha Nam said.

Meanwhile, according to some rice exporting enterprises, after the low price season, Vietnamese rice has returned to winning large quantities of bids at good prices from Indonesia. Accordingly, Vietnamese enterprises won 7 out of 12 bid packages. The total amount of rice that Vietnamese enterprises won bids for was 185.000 tons/320.000 tons. The winning bid price this time between Vietnamese and Myanmar enterprises was the same at 563 USD/ton.

However, with the current CIF export price of rice, the market is selling for up to 630 USD/ton, so for businesses that have bought enough rice for export, it is okay, but for businesses that have not bought enough, there will be price risks.

It is not easy to make an assessment of the export price of rice from now until the end of the year, however, the trend of export price decreasing from now until the end of the year is difficult. According to the assessment of the Vietnam Food Association and reports of ministries and branches, we do not have much left to export from now until the end of the year. Meanwhile, the Philippines is expected to import about 1 million tons of rice from Vietnam.

Indonesia – Vietnam’s second largest rice importer – has just announced a tender for nearly half a million tons of rice, requesting delivery in October and November. Accordingly, the Indonesian National Logistics Agency has just announced a tender for September rice with a quantity of up to 2 tons – the highest tender ever – 10% broken white rice produced in the 11 crop year (milled no more than 9 months). According to Indonesia’s requirements, the rice must originate from Vietnam, Thailand, Myanmar, Cambodia, Pakistan and will be delivered in October and November.

According to data from the Ministry of Agriculture and Rural Development, storm No. 3 (storm Yagi) has caused 190.358 hectares of rice to be flooded and damaged. Talking to reporters of the Industry and Trade Newspaper, Mr. Nguyen Nhu Cuong - Deputy Director of the Department of Crop Production (Ministry of Agriculture and Rural Development) - commented that although the rice export granary is located in the Mekong Delta region, the heavy damage from storm No. 3 and the ongoing floods in the northern provinces could affect Vietnam's rice production.

The Ministry of Agriculture and Rural Development is currently continuing to compile the damage. The Ministry has also issued an official dispatch to the People's Committees of the provinces and centrally-run cities in the Northern region to guide farmers on how to restore production after storms and floods, including rice.

Experts also expect that rice export output will still be guaranteed thanks to new rice varieties, high productivity and quality, and with the increasing import momentum of partners, our country's rice export will still reach the set target.