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Global rice volumes at record levels

Released at: 20:00, 25/01/2017

Global rice volumes at record levels

Photo: Duc Anh

Rice exporters facing a number of harsh realities this year, according to Vietnam Food Association.

by Huyen Thanh

General Secretary of the Vietnam Food Association (VFA), Mr. Huynh Minh Hue, told a conference on January 23 in Ho Chi Minh City that global rice volumes in 2016-2017 are predicted to reach a record 480 million tons, 1.6 per cent higher than from the previous crop and above its own forecast.

Global rice inventories are also forecast to be at their highest levels since 2001. Inventories in major exporting countries are on the decline while those in importing countries and small exporting countries are increasing. This will lead to a fall in import and rice trading contracts.

In previous years, ASEAN countries such as the Philippines, Malaysia and Indonesia imported up to 2-3 million tons of Vietnamese rice annually but in 2016 only imported 10 per cent of this figure. The countries’ governments adopted decisive policies in food security that helped ensure domestic supply and cut dependence on imports. The liberalization of rice trading was also more common, which affected rice contracts, while there was also tougher competition from regional exporting countries.

VFA Chairman, Mr. Huynh The Nang, said that Vietnam’s rice exports will continue to face difficulties in 2017. Exports to China, the world’s largest importer, will also fall short of expectations.

Twenty-two companies are now permitted to export rice, with strict requirements in food safety and origin.

The rice inventory in 2016 was 443,000 tons, while the upcoming winter-spring crop is due for harvest. The VFA said that due to weak demand and abundant supply, rice prices will fall and consumption will face difficulties.

The VFA proposed the Ministry of Agriculture and Rural Development submit rice stockpiles from the winter-spring crop to the government to stabilize market and ensure profits for farmers. The ministry also needs to quickly resolve obstacles in rice exports to high-standard and high-price markets as well as push the development of production based on improvements in quality and efficiency.

In 2016, rice export volumes reached nearly 4.9 million tons worth $2.1 billion, a sharp decline of 25.5 per cent and 20.5 per cent, respectively, against 2015.

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