Vietnam will not put a monthly ceiling on rice export volumes for the rest of the year to achieve its full-year target to ship at least 4.5 million tonnes because overseas demand remains weak as buyers await price falls. Deputy Prime Minister Hoang Trung Hai urged exporters to speed loading under existing contracts and quicken negotiations on new government deals with new markets.
The statement issued late on Tuesday said, without giving details of the deals. The government's instruction comes at a time when export demand for Vietnam rice remains weak, while farmers have ended a bumper summer harvest in the Mekong Delta.
"We do not have buyers for Vietnamese rice now," a trader with a foreign company in Ho Chi Minh City who often sells Vietnamese rice to Africa said. Traders said the government's plan has yet to have any impact on the market. The 5 percent broken rice fell to $520-$530 a tonne on Wednesday, from $540 last week and far below the $600 minimum price set by the Vietnam Food Association for this week.
Exporters, who have to get their contract approved by the association before loading, said they could sell at a price slightly lower than the association's guidance. They offered the 5 percent broken rice at $580 a tonne.
"But prices on the market are anyway far below the 'guiding level', so they can be for reference and there have been no deals," the trader in Ho Chi Minh City said. "If the government secures a large deal, prices may go up but at this time it seems that nobody is buying from Vietnam," he added. Summer-autumn paddy has eased to 4,100-4,500 dong (24.8-27.3 US cents) per kg on Wednesday in An Giang, the Mekong Delta's main growing province, from 4,600-4,800 dong a week ago. However prices have risen 35 percent from the same time last September.
Exporters said their stocks were plentiful and rice mills in the Delta had also reached their storage limit. Vietnam's rice exports in the first eight months of this year fell 4.8 percent to 3.38 million tonnes, but revenues have surged 96 percent to $2.24 billion on high world prices, government statistics show.
This week, seven vessels were loading a combined 60,150 tonnes of rice to the Philippines and Africa at Saigon Port, and two other vessels had left with 25,150 tonnes of the grain for the Philippines, industry reports show. The government has projected to export between 4.5 million and 4.6 million tonnes of rice this year, compared with 4.5 million tonnes shipped in 2007, when the country was ranked the world's third-largest rice exporter after Thailand and India.