Vietnamese rice exports get shot at 2021 breakthrough

High hopes are pinned on Vietnam’s rice exports this year as major markets such as the Philippines and Africa continue to sign contracts to buy the commodity, while many others have great demand for fragrant rice and sticky rice – which are advantageous staples of Vietnamese enterprises. The preferential tariffs provided by bilateral and multilateral free trade agreements (FTA) between Vietnam and other countries, such as the EU-Vietnam FTA (EVFTA) and the UK-Vietnam FTA (UKVFTA), will create favourable conditions for Vietnamese rice to compete with that from rival countries, the Vietnam Food Association (VAF) said.

According to the Vietnamese Trade Counsellor in the UK Nguyen Canh Cuong, rice shipments to the country this year will sharply rise against 2020. He added that more UK firms will purchase Vietnamese rice under the UKVFTA, creating a chance for Vietnamese rice to expand its market share in the UK this year. In 2019, rice exports from Vietnam to the UK had a leap forward with a turnover growth of 376 per cent. That meant the UK has great potential as a rice export market for Vietnam. The Ministry of Industry and Trade said it would provide rice export firms with information about the market demand situation in a timely manner while implementing trade promotion activities to help Vietnamese rice exporters better access customers.

Detailed information about the regulations and barriers under these FTAs’ commitments will be also offered by the ministry so that businesses can improve their understanding and draw up suitable business plans. As part of its efforts to facilitate Vietnam’s rice exports, the VAF has built up online sales channel and participated in online trade seminars to develop the rice industry. It suggested rice exporters focus on high quality products with good export results, ensuring food hygiene and safety to be able to enter more fastidious markets such as Europe, the US and Canada. Experts have said that if Vietnam wants to maintain rice export growth this year it needs to focus on building a complete rice value chain and controlling quality in production, processing, and distribution.

According to the Ministry of Agriculture and Rural Development, Vietnam’s rice output totalled 42.8 million tonnes last year, down about 0.2 per cent because of the shrinkage of some 192,000ha in farming areas. However, the productivity rose 50kg per hectare from a year earlier. The areas of high-grade rice varieties have expanded to 74 per cent, compared to 50 per cent in 2015, as a result of the country’s efforts in improving the value of the Vietnamese rice. Thanks to that, the shipments of high-grade rice made up more than 85 per cent of the total, resulting in the growth of average rice price from $440 per tonne in 2019 to $496 per tonne last year. The country exported 6.15 tonnes of rice for $3.07 billion last year, down 3.5 per cent in volume but up 9.3 per cent in value year-on-year.

The Philippines was Vietnam’s leading rice importer, making up 34 per cent of the total. Rice exports to this market in 2020 reached 2.22 million tonnes and $1.06 billion, up four per cent in volume and 19.3 per cent in value compared to 2019. Other outlets with significant export growth in 2020 were Indonesia (nearly triple 2019’s figure) and China, up 93 per cent year-on-year. VFA vice-chairman Do Ha Nam described 2020 as a successful year for Vietnam’s rice exports, which he attributed to increasing demand in many countries and the improved competitiveness of Vietnamese rice around the world. Amid the difficulties posed by the ongoing Covid-19 pandemic, rice exporters quickly made appropriate adjustments and actively sought new markets while fully tapping into the advantages brought about by FTAs. EVFTA had created a major opportunity for Vietnamese rice to enter European markets and then make inroads into other choosy markets, Nam said.

Author Name: https://www.phnompenhpost.com/business/vietnamese-rice-exports-get-shot-2021-breakthrough