Temporary suspension of rice exports given thumbs-up

Despite this, enterprises say that relevant ministries and authorities based in the Mekong Delta need to find a "common voice" in order to give a proper assessment of the actual situation, thereby providing the government with good advice regarding the temporary suspension of rice exports. This must be done by finding a suitable implementation timescale in order to avoid disadvantages that rice firms and farmers could face.

Since the beginning of the year, Viet Hung Co., Ltd. of Cai Be district in Tien Giang province has signed a contract to export 55,000 tonnes of rice, under which the company purchased 35,000 tonnes, shipped 20,000 tonnes, and continued to purchase another 20,000 tonnes.

Nguyen Van Don, director of Viet Hung Co., Ltd., says that in the face of an ongoing drought and the novel coronavirus (COVID-19) situation, he highly agrees with the government policy of temporarily halting rice exports and revaluating rice paddy inventories throughout the Mekong Delta before making a proper decision on the issue.

Traders in the Mekong Delta buy rice from farmers

Amid the temporary halt of rice exports, the Ministry of Industry and Trade in collaboration with the Ministry of Agriculture and Rural Development and the Ministry of Finance has set up an inspection team who will work alongside key localities and major rice exporters to re-evaluate supply sources, reserves, and the implementation of contracts. They will then report their findings to PM Phuc before March 28 so he can make an informed decision on the matter.

Rice businesses operating in the Mekong Delta will continue to purchase rice to be placed into temporary storage under contracts and to deal with "output" for farmers.

The price of rice has seen falls of VND100 to VND200 per kg in recent days, although paddy prices remain stable. Most notably, farmers are able to earn a profit of 40% after harvest as a result of the high yield of the Winter-Spring rice crop which decreases production costs.

Rice traders believe that central ministries should follow the actual output figures and rice stockpiling of farmers and businesses before offering advice to the government regarding the issuance of an order that allows the temporary suspension of rice exports.

Moreover, a timescale to evaluate the re-export of rice should be considered amid the ongoing drought and increasingly complicated COVID-19 epidemic.

“Vietnam's rice price is chasing Thailand’s closely, which is a good thing. The policy on food security is reasonable,” says Vo Quoc Hung, deputy director of Phuoc Dat Co., Ltd. in Chau Thanh district of Tien Giang province.

Despite rice trading enterprises suffering minimal effects of the order, overall the policy is seen as sensible and also serves to gain common consent from businesses, he adds.

It is worth noting that the domestic rice market has undergone no major fluctuations since the temporary halt of rice exports came into force on March 24.