Rice export price hits new record high

The price of Vietnamese 5% broken rice in the global market increased by approximately US$7 to a high of US$505 per tonne.

The latest rise can be attributed to a limited supply and an increasing demand for rice reserves in many countries, especially the Philippines, largely due to complicated developments of the COVID-19 pandemic globally.

Nguyen Trung Kien, vice chairman of the Vietnam Food Association, anticipates that Vietnam will continue to enjoy robust growth in rice exports in the first quarter of 2021 after its major rice importers such as the Philippines and Africa have agreed to sign additional import contracts.

Furthermore, several markets also have a high demand for fragrant rice and sticky rice, which are advantageous commodities of local businesses.

This is not to mention bright export prospects for rice exports local businesses will enjoy following Vietnam’s recent signing of free trade agreements (FTAs). For instance, countries that make up the Eurasian Economic Union (EAEU) have pledged to provide a tariff quota of 10,000 tonnes of rice for Vietnam this year through the Vietnam-EAEU FTA.

Moreover, the recent signing of the UK-Vietnam Free Trade Agreement (UKVFTA) looks set to allow Vietnamese rice exports to the UK market to enjoy a tax reduction of 0% without quota limits.

According to the Ministry of Agriculture and Rural Development, Vietnam exported 5.74 million tonnes of rice worth US$2.85 billion during January - November 2020, representing a decrease of 2.2% in volume and an increase of 10.4% in value compared to the same period of 2019.