Rain over the past week in the Mekong Delta rice basket has prompted Vietnamese farmers to delay the harvest of the summer-autumn crop and made it difficult to dry the newly cut paddy, traders said on Wednesday.
On Wednesday, the five-percent broken rice for July and August shipment firmed $3 a tonne to $255 a tonne, free on board at Saigon Port from $252 a tonne a week ago, but still on par with the price level two weeks ago.
The twenty-five-percent broken rice rose to $235 a tonne, compared to a range of $230-$232 a week ago. "Most farmers have delayed the harvest and those who have harvested could not dry the paddy so it is still very hard to get fresh grains from the summer-autumn crop," said a trader in Ho Chi Minh City.
"The shortage has seriously affected supply and driven up prices," another trader said. Traders said the summer-autumn crop harvest would peak this month in the Mekong Delta. Buyers who have been waiting for prices to fall are expected to make new purchases, given good demand from African countries, once fresh grains become available.
"We expect the wet weather will continue for a while," said another trader in Ho Chi Minh City. The government weather centre said occasional storms and heavy showers were expected every day during the next 10 days.
Meanwhile, traders said output of the summer-autumn crop could reach 7.53 million tonnes of unhooked rice or 54,000 tonnes more than the similar crop in 2005. The Vietnam Food Association, which oversees rice production and exports, has said it would urge rice export firms to refrain from rushing to sell their rice to avoid price falls.
The association also said this week that exporters had signed contracts to export 4 million tonnes so far this year, 2.9 million tonnes of which had been shipped. Government statistics last week showed rice export revenues in the first half of the year were expected to rise 4.2 percent on a year to $794 million, or an average of about $270 a tonne.
The government has capped rice exports for 2006 at 5 million tonnes, but industry officials said the quantity was adjustable. This week six vessels are loading 38,600 tonnes of rice at Saigon Port mostly for the Philippines. Another 7 vessels have completed loading 73,800 tonnes for Africa and the Philippines.