In the southern province of An Giang, farmers are selling summer-autumn rice at VND3,800-4,000 per kilo, up VND50/kilo compared to the previous week. Jasmine rice is being sold at VND4,600 per kilo, up VND300/kilo compared to the previous month. Nguyen Quang Lap, deputy head of the Planning section under the provincial department of Agriculture and Rural Development said that rice prices are increasing again.

Pham Quang Dieu, director of the Information Centre for Agricultural Development (Agroinfo) said that the increase in rice prices in some Mekong Delta provinces is attributed to the fact that some enterprises are purchasing rice from farmers to fulfill previously signed contracts. According to the Vietnam Food Association, in early July, businesses delivered 3.86 million tonnes of rice worth nearly US$1.6 billion.

Nguyen Trang Nhung, an expert from Agroinfo said that the rice market recovered in the last few days of the second quarter with big rice export orders being recorded.

Nguyen Dinh Bich, an analyst from the Trade Research Institute said that Vietnam does not have the facilities to store rice like Thailand, so the country will be at a disadvantage if it does not export large volume of rice.

Hidden dangers

The development on the world rice market has shown that demands are exceeding supplies. This year, the world’s total rice export volume is likely to reach 29.7 million of tonnes while the import volume is just 26.3 million of tonnes. Mr Dieu said there would be unseen developments in the rice market from now until the end of the year.

Truong Thanh Phong, Chairman of the Vietnam Food Association said that both Thailand and India are expected to stockpile huge volumes of rice. Therefore, many countries have stopped importing rice to monitor the development of the world’s rice prices in the near future. Mr Bich said that Thailand is likely to store 8 million tonnes. Mr Bich added that the standstill in the world rice market is unusual. In fact, the world’s rice prices have dropped below US$600 per tonne.

According to Agroinfo, there will be two possibilities for Vietnam’s rice market from now until the end of the year. First, if both Thailand and India have not yet sold their stockpiles of rice, Vietnam will be able to export 6 million tonnes. Second, if the two countries have stockpiled their rice, Vietnam will find itself in rather an awkward situation like last year’s scenario having rice in abundance but fetching ridiculously low prices.