Rice export slumps in second quarter

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Farmers reap rice in the Mekong Delta

The increase was thanked to contracts signed in 2015, especially Government to Government (G2G) deals with Indonesia and the Philippines and a large number of commercial deals with China.

According to the VFA, the strong growth in the first quarter and drought have affected rice productivity and output in the Mekong Delta and highly increased domestic rice prices.

Therefore, exporters have offered higher prices than those from India, Pakistan and Thailand. Vietnamese rice price was US$10-20 a ton higher than Thai rice. This has caused many businesses hesitate and not sign new export contracts.

Commercial contracts especially from China drastically fell while G2G contracts nearly ran out in April and May, resulting in volume drop to below the annually average level of 600,000.

The strong fall has sent Vietnam to reduce rice export norm in the second quarter from 1.8 million tons to 1.5 million tons.

However with current situation, the second quarter is likely to export about 1.3-1.4 million tons, the lowest for the same period of the last several years. The VFA forecast that the number will approximate only 450,000 tons in June.

Difficulties reaching yearly export targets expected Vietnam could face numerous difficulties in reaching its export value target for this year because of low ...

Total export volume thus might reach 2.7-2.75 million tons in the first half this year.