A key rice crop harvest in southern Vietnam is at its peak, but industry restrictions on export prices aimed at ensuring supply to Indonesia and the Philippines have stopped deals with other buyers, traders said.
The Vietnam Food Association, an industry body, has set the export price for 5 percent broken rice at $305 a tonne, free on board at Saigon Port, for shipment in April while deals with May or June loading must be priced at $310 a tonne.
"Spot shipment can be offered at $300 a tonne but these prices are already very high so nobody wants to buy," a trader at a foreign firm in Ho Chi Minh City said, noting that the price for 10-percent broken rice would be $5 lower.
All export contracts need the association's approval before loading can start.
The association has asked exporters to stop selling the 15-percent broken and the 25-percent broken grades, saying the grain must be reserved for shipments to Indonesia and the Philippines, traders said.
The varieties are Vietnam's most common grades for export.
The two Asian key rice buyers have purchased more than 1 million tonnes of Vietnamese grain via tenders in recent weeks for deliveries until June.
Last week, four Indonesia-bound vessels completed loading of 21,000 tonnes of the 15-percent broken rice at Saigon Port. Only two other vessels have been loading a combined 18,000 tonnes of rice for the Philippines and Malaysia this week.
"A lack of vessels will result in a huge stockpile of paddy in the Mekong delta's rice warehouses as the harvest is at its peak and more grain will come next week," the Ho Chi Minh City rice trader said.
With an export price restriction in place, domestic paddy prices in the delta were stable instead of falling at the peak of the harvest, traders said.
The winter-spring paddy, Vietnam's best quality grain, has been priced at between 2,600 dong and 2,700 dong ($0.16-$0.17) per kg in the Mekong delta food basket since the start of March.
The harvest normally ends next month. The Trade Ministry has forecast rice exports in 2007 to fall to 4.5 million tonnes, from 4.75 million tonnes in 2006.
In its master plan for developing agricultural crops in the delta until 2010, the Agriculture Ministry said rice production should remain the first priority in the region, even though fisheries are also considered important.
The delta is projected to have stable paddy output of 18 million to 19 million tonnes per year, sufficient for the domestic market and also enough to export 3.5 million tonnes to 4 million tonnes of husked rice annually, the ministry plan said.
Comments
Comments are closed.