Vietnam rice stocks dwindle

Vietnam, the world's second-largest rice exporter, is running out of stock during the period between crops but exporters have a big enough stockpile to meet loading demand for Indonesia and the Philippines, traders said.
They said Vietnam had started loading for a contract of up to 300,000 tonnes for Indonesia. The deal executed by Viand 2, Vietnam's biggest rice exporter, and its affiliates are for shipment this month and in December.
Two vessels were loading a combined 21,350 tonnes of rice for Indonesia on Wednesday at Saigon Port. Another three vessels out of the seven that ended loading last week were also bound for Indonesia, with 22,800 tonnes.
The remaining four vessels were taking a combined 39,300 tonnes to Cuba, Malaysia and Africa. New demand has also emerged as the Philippines said it would hold a tender on December 8 to buy 350,000 tonnes of 25 percent broken rice for shipment between January and March next year.
"Exporters have sufficient stocks for the two buyers while the prices on domestic markets have been rising as farmers have sold out," said a trader in Ho Chi Minh City.
Prices had risen only in Vietnam, while prices in India and Pakistan were stable during their harvest, he added. A government ban on new export deals imposed last month remained in place.
"Given the thin stocks, Vietnam might ask Indonesia to extend delivery, probably to next year," said a second trader.
Vietnam would be able to meet the demand for the Philippines but loading in January and February would be tough as the harvest of its highest-yielding winter-spring crop in the Mekong Delta could only peak from March 2006, traders said.
"So if Vietnam wins the tender, pricing negotiations for other deals will be very tough," the first trader said. "There is a delay in crop production because seasonal floods have not fully receded, even though farmers have started planting where water has gone," he said.
As stocks shrink, paddy prices in the Mekong Delta rose to 2,450-2,550 dong (15.4-16.1 US cents) per kg this week, from 2,200-2,400 dong last week.
Indicative export prices have also firmed. The 5 percent broken rice rose to $262-$264 a tonne, free-on-board basis, from $258-$260 last week.
The 25-percent broken rice also jumped to $240-$242 a tonne, from $235-$238 a week ago.