September 26, 2012
Vietnam Could Become World's Biggest Rice Exporter
This year, Vietnam may surpass Thailand as the world's biggest rice exporter. For the long-term, the country is increasing its rice quality and plans to tap into the China market.
Long ranked second in terms of rice exporters, Vietnam is expected to export around seven million tons of rice this year. Estimates put Thailand at around 6.5 million tons.
Nguyen Van Don, general director of rice exporter Viet Hung, says thanks to Thailand's high price guarantee for farmers, Vietnam is in the lead so far.
"The reason is due to the program of storing and buying up rice to support the farmers of Thailand. Now it is very difficult to compete for selling price," explained Nguyen. "Now Vietnam is competing very tough with India and Pakistan and Burma, mostly with India."
A bad rice crop in southern China has also helped by increasing demand for Vietnam's rice. So far this year, China is the top buyer.
"This year my company exported lots of rice to China," Nguyen said. "In recent years China imported very little, most of it imported through unofficial ways. This year they started importing through official channels. They bought really quickly en masse. This year Vietnam may export more than 2 million tons to China. It means it is now a potential market."
Vietnam's rice is a lower quality than Thai rice and does not usually compete for the same markets.
But officials say Thailand's drop in exports may still create opportunities.
"It is not a big opportunity here but it is a long-term opportunity in order to help Vietnam to step by step change the structure of its rice seeds, to expand the area of high quality rice in order to meet the demands of both domestic and export markets in the next few years," said Huynh Cong Minh, deputy director of the Agriculture and Rural Development Department in Tien Giang province.
Officials say about 45 percent of Tien Giang province is planted with higher quality rice but they plan to gradually increase that area and approach new markets.
That would help Vietnam's many rice farmers and laborers.
Rice farmer Nguyen Ngoc Phan has planted high quality rice for the last five years and says it has increased his income.
"In recent years I plant high quality rice according to the recommendation of the state and local authorities. If we produce the high quality rice we get the higher price," he explained. "So, I have one hectare I planted all with high quality rice."
Vietnam's rice insiders say they would welcome being number one in exports but whether they can maintain the title depends on the weather and global demand.
And officials say status is less of a concern than producing higher quality rice to meet the future needs of both domestic and international consumers.