Despite a hike on export turnover, the average export price drops 9.6% in the first seven months of 2022. Illustration.

Despite a hike on export turnover, the average export price dropped 9.6% during the period to 488.9 USD per tonne. It is likely that rice prices will not increase in the coming time as a result of low demand and abundant supply from major exporters.

Generally, the market is currently weak, with low purchasing power, said Nguyen Van Don, Director of Viet Hung Co., Ltd, a food exporter based in the Mekong Delta province of Tien Giang. Since the start of this year, Vietnam mostly exported to the Philippines while shipments to China declined significantly.

Exports to other markets, though stable, remained small, he continued, so the rice market will probably stay stagnant until the end of the summer-fall crop.

Inventory of importers are rising so it is unlikely that prices would improve, said Do Ha Nam, Vice President of the Vietnam Food Association (VFA). Meanwhile, bumper harvest is forcing exporters to boost sales, he added.

According to VFA, 5% broken rice fetched 393 USD per tonne and the 25% broken rice, 378 USD per tonne on August 17. The prices were lower than those of Thailand, but higher than India’s and Pakistan’s.

The Philippines was biggest buyer of Vietnam's rice, accounting for 48.6% of total export volume and 46.6% of total value in the seven-month period. It imported 1.98 million tonnes of rice, worth nearly 924.9 million USD, from Vietnam, up 67% and 40%, respectively, year-on-year.

It was followed by China that made up over 11.4% of the total volume and 12.2% of the total revenue. Exports to the neighbouring country slid 28% year-on-year in both volume and value.

Nam anticipated that Vietnam will ship abroad some 2 million tonnes of rice in the remaining months to raise total export volume of the entire year to over 6 million tonnes, worth about 3 billion USD./.