Vietnam’s rice exports rise ahead of Thailand's massive stockpile sale

By Toan Dao   May 16, 2016 | 11:40 am GMT+7

Vietnam exported 2 million tons of rice in the first four months of this year, surging 8.5 percent on year, according to the latest data from Vietnam Customs.

Export value from rice rose to $892.5 million in the first four months, up 10.7 percent from January-April in 2015.

However, concerns are rising about oversupply in the international market after Thailand’s government announced a plan on April 25 to sell 11.4 million tons of stockpiled rice over the next two months with the aim of generating Baht100 billion ($2.81 billion).

Thailand’s Ministry of Commerce said the country has about 100,000 tons of "good grade" rice in state warehouses, 7.5 million tons of "sub-standard" rice, 1.5 million tons of rice earmarked for industrial use and 2.4 million tons of spoiled rice, Vietnam News Agency reported on April 26.

This massive sell-off would certainly have an impact on the global rice market in general, and on Vietnam's rice market in particular, Le Van Banh, director of the Vietnamese Department of Agro-Fisheries Processing and Salt Production, told VNA.

However, the impact on Vietnam's rice exports would not be significant, at least in the short term, Banh said. He added that Thailand's plan to sell 11.4 million tons of rice in just two months was not feasible.

The impact on rice exports is expected to be small in the second and third quarters of this year as most contracts were signed at the end of 2015, and there was still an estimated 1.4 million tons of rice remaining to be shipped abroad under existing contracts, the Vietnam Food Association has said.