Vietnam, the world’s second-largest rice exporter after Thailand, is capable of shipping between 7.0 million and 7.3 million tonnes of the grain this year, after a record volume in 2010, the Agriculture Ministry said.
A higher supply in Vietnam, plus India lifting a rice export ban in place since 2008 and Thailand raising its annual export forecast to more than 10 million tonnes for 2011 could help keep Asian prices in check.
Vietnam could export more rice as the national paddy output would rise 2.2% from 2010 to 40.78 million tonnes, Deputy Agriculture Minister Bui Ba Bong said in a document sent to the ministries of trade and finance and the Vietnam Food Association. The Southeast Asian country exported 6.83 million tonnes of rice in 2010.
The volume available for export this year is in line with earlier agriculture ministry’s shipment forecast of between 7.1-7.4 million tonnes. The Agriculture Ministry recommended trade ministry and rice industry officials to regulate Vietnam’s annual rice export this year based on the new production data, it said in the document issued on Tuesday.
“This is good news for the rice market and prices could soften,” a trader at a foreign company in Ho Chi Minh City said, reacting to the Agriculture Ministry’s move. An export price increase of Vietnamese grain since late last week despite an ongoing major crop harvest in the Mekong Delta food basket, came to a halt on Wednesday after India agreed to allow 1 million tonnes of common rice exports.
Vietnamese rice exporters and foreign buyers are waiting to see market reactions to India’s ban lifting before making new deals, leaving the market quiet in Vietnam on Wednesday, traders said.
The summer-autumn rice crop harvest is to peak soon in the Mekong Delta.
Its yield and output are expected to rise, and along with better production in the rest of the southern region, the regional output could get an additional 550,000 tonnes of paddy, the Agriculture Ministry said in the document.
Vietnam’s 5% broken rice stood at $505-$510 a tonne on Wednesday, unchanged so far this week but up from $495 last Wednesday, while the 25% broken rice stood unchanged at $460 a tonne, free-on-board (FOB) basis.
Vietnamese exporters have signed contracts to ship a combined 5.26 million tonnes of rice so far this year, industry reports said.