The market is open, the price is good, why do rice exporters still complain?

	Ports create favourable conditions for rice exporters
	Prevention of price risks before news that Indonesia increases rice imports in reserve
	Rice exporters benefit from rising prices

The association will help enterprises increase their initiative in raw materials even in volatile market periods. Photo: T.L

Beware of “a taste of your own medicine”

Tran Duy Dong, Director of the Import-Export Department, Ministry of Industry and Trade, said that the global food supply shortage due to the impact of India's ban, the Black Sea Grain Initiative was broken and climate change growing conditions… will reduce the supply and push up food prices. Accordingly, most countries are carefully considering the impacts of the global market to quickly introduce measures to support domestic production and stabilize domestic food prices. For example, in Thailand, the Honorary President of the Thai Rice Exporters Association said that India's ban should be carefully assessed and considered because it may affect domestic rice prices and may affect the price of rice. This could lead Thai rice millers and rice exporters to delay rice orders to assess the impact.

For rice importers, Tran Duy Dong quoted Chairman of the Philippine Food and Agriculture Department (PCAFI) as saying, India's rice export ban will increase speculation and competition, shifting import orders to other rice exporting countries, pushing up prices, putting more pressure on domestic rice prices. The country director of the Federation of Free Farmers (FFF) said traders are now looking at information on supply and prices from major rice exporting countries like Vietnam. After the ban took effect, many Filipino businesses accepted new offers from Vietnamese businesses to have goods in August when the summer-autumn crop was harvested.

In that context, Minister of Industry and Trade Nguyen Hong Dien especially emphasized the need to take advantage of the opportunity to export rice to bring the highest efficiency but must ensure food security in all situations. In particular, it is necessary to be cautious before the decision to ban rice exports from other countries. If this is the time to rush up, watch out for "his stick hit his back". A country famous for exporting rice but in the country lacks rice, so that the price of rice is too high to affect people's lives is unacceptable.

Difficult to take advantage of opportunities due to lack of links

According to the announcement of the Vietnam Food Association, on August 4, the export price of 5% broken rice traded at $618/ton, 25% broken rice at $598/ton. Thus, the export price of rice has increased sharply by 60 USD/ton for both 5% broken rice and 25% broken rice in just the past 1 week. In the same direction as the export price of rice, the price of rice in the Mekong Delta has also continuously increased sharply, the price of raw rice has risen to 12,100 VND/kg, finished rice at 14,100 VND/kg.

From the perspective of Vietnamese rice exporters, Huynh Thi Bich Huyen, Chairman of the Board of Directors of Ngoc Quang Import-Export Company, considers the increase in rice prices to be good news for farmers, but enterprises face difficulties. "The price of rice increased without stopping while the previously signed contract could not adjust the price of rice, so businesses were forced to buy high prices to meet orders," Huyen said.

From the reality of enterprises' difficulty in meeting orders when the price of rice continuously increased, the story of linking rice production and consumption continued to be raised. According to Deputy Minister of Agriculture and Rural Development Tran Thanh Nam, in the Mekong Delta, there are 3 forms of consumption linkage: farmers sell rice directly to enterprises, accounting for 12.1% of total output; farmers through traders sell to enterprises for processing and exporting, accounting for 50%; The remaining 37.9% are farmers who sell rice through cooperatives signed with enterprises. Notably, out of 180 enterprises that are eligible to export rice in the Mekong Delta, only 50 have signed an association agreement with cooperatives and built raw material areas. The rest buy and sell themselves, leading to competition, high prices, low prices, no rice storage, no raw material areas, floating buying. That is the reason leading to the difficult situation of enterprises in terms of raw materials.

In fact, in the past time, the story of rice production and consumption has almost no new faces, apart from familiar names such as Loc Troi, Tan Long, Trung An...

These limitations in linking are also evident in the data of localities. Nguyen Thanh Huan, Deputy Director of An Giang Department of Industry and Trade, said that in the summer-autumn crop of 2023, the whole province of An Giang will reduce to 228,750 hectares and set a plan to link production and consumption of 145,540 hectares, accounting for nearly 64% of the area with 14 companies, enterprises and similar companies. However, so far, only 32,725 hectares have been signed offtake contracts with enterprises through cooperatives and cooperative groups, with the rate of only 22%. In which, there are enterprises that have just signed an underwriting contract for an area less than 2% of the plan.

Similarly, Vo Phuong Thuy, Deputy Director of Dong Thap Department of Industry and Trade also said that in Dong Thap, the summer-autumn crop planting area is 184,758 hectares, but the associated area is only 28,183 hectares, accounting for 15. ,2%. Previously, in 2022, the area of consumption linkage only reached 17.3% of the total production area.

According to localities, many businesses have not focused on building material areas and linking purchasing with farmers. This leads to an unstable source of raw materials in terms of quantity and quality, causing a shortage of production materials to supply signed orders, especially in the context that rice prices are fluctuating day by day. Therefore, in order to take advantage of the "golden opportunity" of the current rice market, localities have proposed the Ministry of Agriculture and Rural Development to have solutions to support enterprises in building raw material areas. At the same time, there are many propaganda activities for farmers, cooperatives and businesses to understand more about the meaning of consumption linkages so that rice production and export activities develop sustainably, stably and bring benefits to the stakeholders.