Manila raises import demand of Vietnam rice

Easing rice export prices in Vietnam are expected to further their slide in the next month as harvesting of a key crop in the country's southern rice basket is nearing its peak, traders said on Wednesday. They said even though the Philippines, a key buyer of Vietnamese rice, raised its import demand, the change has little impact on the market in Vietnam, the world's second-largest exporter of the grain after Thailand.
Last on Saturday the Philippines raised its 2005-rice import to 1.8 million tonnes from projected 1.6 million tonnes. Traders said only state-run companies in Vietnam, but not foreign trading firms, have the right to sell Vietnamese rice to Manila.
Besides, the demand change of just 200,000 tonnes is not significant compared with Vietnam's summer-autumn harvest, estimated at 9.5 million tonnes of paddy.
"The number of loading vessels this week is less so prices eased. The closer to the harvest peak next month, the lower the prices," said a trader at a foreign company in Ho Chi Minh City.
Harvesting in the Mekong Delta is expected to peak next week. The delta grows three crops a year, of which the winter-spring crop produces the highest yields and the best quality grain, followed by the summer-autumn crop.
Seven vessels are loading a combined 98,400 tonnes of rice at Saigon Port for Cuba, Sierra Leone, the Philippines, East Timor and the Philippines.
Last week 18 vessels completed loading 181,208 tonnes for the Philippines, Africa and Cuba. Quotations for the 5 percent broken rice eased this week to $225 to $228 per tonne, free-on-board Saigon Port, from $235-$237 last week.
The 25 percent broken rice also fell to $210-$212 on Wednesday, from $220-$222 a week ago. Traders said buyers were waiting for prices to drop further before they start new deals.
"Exporters also dare not sign now as they fear losses," said another trader in Ho Chi Minh City. But to intercept the Philippine demand and to help keep prices stable, the Vietnam Food Association raised the indicative offer for the 5 percent broken rice to $240 a tonne on Wednesday, free-on-board basis, from $238 on Monday.