Agriculture & Food

According to customs data, Vietnam's rice exports exceeded 7.1 million tons in 2022, with exports reaching 3.45 billion US dollars, an increase of 5.1%. Last year, the average export price reached $486 per ton.

Customs data shows that from August 2022 to the end of the year, the price of rice with a crushing rate of 5% in Vietnam remained stable at a high level, $15-27 higher than Thai rice and $40-50 higher than Indian rice.

Customs data shows that in the first two months of 2023, the export price of Vietnamese rice continued to rise, with an average price of $520 per ton. Therefore, although the export volume decreased by more than 20% in January this year, the export volume increased by about 7%. Although the world market is volatile, Vietnamese rice has penetrated into markets such as Japan and the European Union that have strict quality requirements. The prices of ST24 and ST25 fragrant rice have remained high, exceeding $1000 per ton, which is more than twice the export price of ordinary white rice. For rice exporting enterprises, this year is also a year of bumper rice harvests in Vietnam, with a continuous flow of orders from major markets.

The rice production industry continues to shift towards reducing production and improving quality, and continuously introduces high-quality varieties, with a focus on meeting the high requirements of the world market for green production, emission reduction, pesticide reduction, and organic fertilizer application.

This to some extent explains the reason why Vietnamese rice has been rising recently. The prices of famous brands such as ST24 and ST25 have even soared to over $1200 per ton.

It is worth mentioning that last year, export enterprises actively explored the EU market and fully utilized the Vietnam EU Free Trade Agreement (EVFTA). The EU provided Vietnam with a rice quota of 80000 tons, and the actual export volume reached 94510 tons. This indicates that the quality of Vietnamese rice is constantly improving, meeting the strict requirements of the market, and fully utilizing the free trade agreement.

Continue to achieve market diversification and development

With the return of markets such as Indonesia, Bangladesh, and China, the Vietnamese Ministry of Industry and Trade predicts that Vietnam's rice exports will continue to improve in 2023 (approximately 6.5-7 million tons).

Vietnam's rice exports have received consecutive good news, with orders from China and the Philippines significantly increasing. The most noteworthy is the Chinese market, which has been gradually finalizing orders after reducing Vietnamese rice imports in 2022. According to customs data, in the first two months, China imported 152640 tons of Vietnamese rice, nearly 90 million US dollars, with an 86% increase in import volume and a 120% increase in import volume.

The average export price of Vietnamese rice to China ranks first, at 589.7 US dollars per ton, a year-on-year increase of 18.3%. According to export companies, Chinese customers currently mainly import high-end products such as fragrant rice and glutinous rice from Vietnam.

The Philippines, which imported over 3 million tons of rice from Vietnam last year, is still increasing its rice imports. It is predicted that the country will need to import 2.8 million tons of rice in the 2022-2023 crop year, which also creates more opportunities for Vietnam to increase its rice exports.

Customs data shows that India, the largest exporter of rice, has reduced its arable land area by 380000 hectares due to drought. This is also an opportunity for rice exporting countries such as Vietnam.

However, the Vietnamese Ministry of Industry and Trade also acknowledges that rice exports are facing many challenges this year, such as inadequate market diversification strategies for rice exporting enterprises and many difficulties in exporting high-quality rice.

Pan Wenzheng, Director of the Import and Export Department of the Ministry of Industry and Trade, stated that China's reopening of the market is a great news for rice export enterprises in 2023, but the rice export market still faces problems such as high sea freight and production costs.

Therefore, the rice production industry needs to improve the quality of rice, ensure the requirements for pesticide residues, plant quarantine, and traceability, in order to fully utilize the dividends of the currently in effect free trade agreements.