Quality not quantity: Vietnam should lower rice export target

By VnExpress   December 14, 2016 | 11:51 pm PT
Quality not quantity: Vietnam should lower rice export target
A farmer harvests rice at a paddy field outside Hanoi. Photo by Reuters/Kham
Overseas markets seem to be losing their appetite for the world’s third largest rice exporter.

Vietnam should adjust its rice export target in terms of volume to focus on product quality amid a shortage of buyers and falling output, said Huynh The Nang, chairman of the Vietnam Food Association.

Nang said that adjusting the target down to 2-3 million tons from 7-8 million tons annually is necessary due to falling demand from major partners.

Data from the association showed that 70 percent of Vietnamese rice is exported to Asian countries, with China the biggest buyer, followed by the Philippines, Indonesia and Malaysia.

However, rice exports to these markets have witnessed slow growth.

Last year, Vietnam exported two million tons of rice to the three key Southeast Asian markets, but that figure has collapsed by 90 percent to a mere 200,000 tons this year.

These countries are trying to boost their own rice production and have started getting good results, which have reduced their independence on Vietnamese supplies, Nang said.

China, which accounts for a third of Vietnam’s total export volume, continues to tightly control the quality of rice imports that reach its market. From January to October, Vietnamese rice exports to China fell by 22.5 percent on-year to 1.5 million tons.

Luong Hoang Thai from the trade ministry said that Vietnamese rice faces numerous trade barriers.

Most countries have adopted measures to limit rice imports and protect their domestic markets. South Korea has set an import tariff of up to 500 percent while Japan imposes a rate of 800 percent, not to mention non-tariff barriers involving import quotas and food safety.

“Instead of struggling to find buyers for a huge volume of rice, we should set a target of exporting 2-3 million tons each year rather than year 7-8 million tons as we have done in the past,” the chairman of the VFA said.

Over the 2015/2016 winter-spring crop, the Mekong Delta, which accounts for 90 percent of the country’s rice exports, was hit by the most severe drought in almost a century, causing its rice output to decrease by one million tons.

Rising sea levels together with the construction of Chinese dams on the Mekong River are posing serious threats to rice farming in the delta.

Rice experts agree that it’s time Vietnam shifted its focus from quantity to quality to meet food safety standards and ensure rice supplies.

Pham Thai Binh, a rice trader, echoed the same idea: “To expand its rice market, Vietnam must produce products that are tasty, clean and cheap."

“Domestic consumers are opting for the more expensive Cambodian rice at the moment because they believe it’s cleaner that locally-produced rice.”

Data from the agriculture ministry showed that Vietnam exported 4.5 million tons of rice over the first 11 months, down 25 percent against one year ago.

The country is expected to export 5 million tons of rice this year, lower than the target of 5.65 million tons set in the summer.

Related news:

Thin demand drives Vietnam's Jan-Nov rice exports down 25 percent

Vietnam struggles to find buyers for over 1 million tons of rice

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