Vinafood 2 says Vietnam should sell rice to Philippines

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VietnamNet English - 56 month(s) ago 1 readings

Vinafood 2 says Vietnam should sell rice to Philippines

The domestic price of rice has been increasing continuously and worries have been raised about a possible shortage. Local media, quoting international agencies, has predicted a worldwide rice shortage. India reportedly plans to import three million tonnes of rice next year. However, Nguyen Tho Tri, Deputy General Director of Vinafood 2, a state owned enterprise which has bid to sell 600,000 tonnes of rice to the Philippines, believes that Vietnam should sell rice to the country, and that Vietnam is likely to win the bid.

VietNamNet Bridge – Vinafood 2, Vinafood 2, one of Vietnam's biggest rice exporters, has offered the public reassurances against potential domestic rice shortages., saying that Vietnam should sell as much rice to the Philippines as they can, if the price is right.

In the latest interview given to Thoi Bao Kinh Te Saigon, Tri denied the criticism that the food corporation has been focusing on export, while ignoring the task of stabilising the domestic market.

He said that Vietnam has made four bids in the last two months to provide the Philippines with rice. The Philippines opened the bidding in early November and Vietnam offered to sell the nation half the requested volume.

With the second and third bids, Vietnam also offered half the volume the country needed (300,000 tonnes vs 600,000 tonnes). The fourth, which opened on December 15, Vietnam offered to sell the requested 600,000 tonnes at 664.9 dollar per tonne, which is 15 dollars higher than the price offered one week ago.

“Vietnam’s rice supply is ample. Farmers will begin harvesting the early winter-spring crop in January. We will have three million more tonnes of rice in February and March, at the peak crop. So we should sell as much rice to the Philippines as it wants,” Tri said.

Some experts have warned that Vietnam will lose money if it sells a large quantity of its rice now; the rice price is expected to increase in the world market.

Vietnam’s average export price in the first 11 months of the year was just 445 dollar per tonne. Meanwhile, the bidding price has jumped to 650 dollar per tonne

now.

However, Tri said that it is unreasonable to compare export prices under commercial contracts with the export prices under contracts obtained by bidding. The export prices under the contracts obtained by bidding include freight costs and other expenses, while the prices under commercial contracts are FOB prices (free on board).

In the first 11 months of the year, Vietnam exported 5.7 million tonnes of rice, reaping 2.535 billion dollar in turnover, an increase of 32 percent in quantity and a decrease of 6.6 percent in turnover. Tri does not think that the price of rice will continue rising the next year. The world’s market is quiet now, and Vietnamese enterprises have successfully signed commercial contracts with India. The one billion-strong country wants to purchase rice to fill its stocks.

VietNamNet/TBKTSG

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