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| Loc Troi Group’s rice packaging at their An Giang factory. (Photo: VNA) |
Hanoi – Vietnamese Trade Counselor in India, Bui Trung Thuong, advises local rice exporters to enhance their global competitiveness and diversify their markets and sales channels. This advisory comes in light of India’s recent decision to lift its ban on 100% broken rice exports, which has created challenges for rice-exporting nations due to falling prices.
In an interview with Vietnam News Agency (VNA), Thuong discussed the potential impact on Vietnam’s rice market following India’s removal of the ban on March 7. He attributed the Indian government’s decision to two main factors: rising rice production surpassing last year’s levels and the need to clear high rice reserves before the new harvest, alleviating earlier concerns over food security.
The ban imposed by India on 100% broken rice exports in September 2022, extended to regular white rice in 2023, significantly impacted global rice prices, pushing them from around $450 per tonne to a peak of $700 per tonne. However, prices have recently witnessed a sharp decline, with Vietnamese and Thai 5% broken rice experiencing drops of 38-45%. Vietnam’s prices have fallen from $680-$700 per tonne to $390-$400 per tonne, an unprecedented decrease.
According to Thuong, while the price drop from the $700 per tonne peak was anticipated, the current rate of $390-$420 per tonne is reasonable and beneficial for both exporters and importers. Global rice prices are expected to stabilize due to various factors, including projected global production increases, expanded use of rice in ethanol and industrial applications, and stable demand, with rice being a staple food for about half of the world’s population.
Given this context, Thuong recommends that Vietnamese rice exporters focus on developing high-quality rice varieties and building strong branding based on geographical indications to enhance their global reputation. He also emphasizes the importance of diversifying markets and sales channels, reducing dependence on government-to-government deals, and expanding into the private sector. By implementing these strategies, Vietnamese rice exporters can strive to maintain their market share, even in regions with lower export volumes or turnover.
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