The year 2023 is coming to a close with outstanding results for rice export activities. Vietnamese rice grains have proven to be precious "pearls," with prices and export turnover continuously on the rise. This demonstrates that Vietnam, being one of the world's leading rice exporters, has experienced positive developments in its rice export market.
Vietnam's rice export has seen remarkable success towards the end of 2023
According to customs statistics, by mid-December, Vietnam had exported over 7.9 million tons of rice, valued at over $4.5 billion, marking an 11% increase in volume and a 29% increase in value compared to the same period in 2022. In 2023, rice exports are projected to reach around 8.2 million tons, with a trade turnover of nearly $4.8 billion, the highest level since 1989 (the year Vietnam began rice exports).
Notably, the proportion of high-quality rice varieties from Vietnam has increased from 50% in 2015 to 74% in 2020 and currently stands at 85%. The export volume of rice has been maintained at around 6 million tons, showing a growth trend in recent years, with the export value consistently exceeding $3 billion annually.
Vietnam's rice continues to strengthen its brand in the market. Recently, ST25 rice was once again honored as the world's best rice in 2023. This recognition has also contributed to ST25 officially enjoying tariff preferences when exported to the European Union market since December 19.
According to the Import-Export Department (Ministry of Industry and Trade), in the first 9 months of 2023, rice export turnover reached nearly 6.42 million tons with a value of $3.54 billion, a 19.5% increase in volume and a 35.9% increase in turnover compared to the same period in 2022. The average export price reached $551 per ton, a 16.8% increase compared to the same period in 2022, with rice exports to the Middle East accounting for 1.6% of the total rice export volume.
Vietnam's rice export prices continue to rise, reaching the highest level in the last three months
According to the Ministry of Agriculture and Rural Development, as of the end of November, the total rice cultivation area in Vietnam was 7,377,300 hectares, a decrease of 0.2% compared to the same period last year. The harvested area was 6,705,400 hectares, down 2.2%, with an average yield of 61.4 quintals per hectare, an increase of 1.2 quintals per hectare. The total harvested output was 41.2 million tons, a slight decrease of 0.2%. Regarding exports, the price of Vietnam's 5% broken rice has increased to $655 - $665 per ton from the previous range of $650 - $655 per ton.
Experts suggest that with the current results, Vietnam's rice exports to the EU may reach around 100,000 tons, the highest figure to date and surpassing the quota of the EVFTA Agreement. Although the quantity is not very large, it brings significant added value. This market is also seen as a potential export destination for various types of fragrant and organic rice from Vietnam.
On the global market, rice export prices continue to rise. According to the Vietnam Food Association (VFA), in the third week of December, the price of Vietnam's rice remained stable at $663 per ton, which is a high price in many years.
Assessing Vietnam's rice export achievements in 2023, Nguyen Nhu Cuong, Director of the Department of Crop Production (Ministry of Agriculture and Rural Development), stated that with India, which accounts for over 40% of the world's rice supply, implementing restrictions on rice exports, it provides an opportunity for other suppliers in the market. The success of Vietnam's rice sector lies in seizing this opportunity to increase revenue and profits for farmers.
Creating Momentum for the Development of the Rice Industry in 2024
In 2024, the global rice production is projected to reach a record of nearly 520 million tons, while consumption is expected to approach 525 million tons. This implies a potential global rice shortage of 5 million tons in the coming year. Furthermore, global rice inventories have decreased to just over 160 million tons, presenting a significant opportunity for Vietnam's rice industry.
Several countries, including significant trade partners like Indonesia, are anticipating an increase in rice imports, with Indonesia expecting to import around 600,000 tons. Another important partner, the Philippines, is forecasted to import over 2.8 million tons of rice in 2023, with 90% of that volume coming from Vietnam, 4.5% from Thailand (126,560 tons), and 4.3% from Myanmar (120,538 tons), with the rest from Pakistan, India, and Cambodia.
According to the Institute of Policy and Strategy for Agriculture and Rural Development, Vietnam's rice export prices in 2024 are expected to remain high, staying above 640-650 USD per ton. This is attributed to the global rice supply gradually becoming scarce, while traditional markets such as the Philippines, Indonesia, and China maintain high demand for rice imports to meet consumer needs and reserves.
Professor Dr. Vo Tong Xuan, a rice industry expert, suggests that the rice sector should persist in developing a strategic approach focused on quality and value. He emphasizes the need for modern and environmentally friendly agricultural development, also known as Net Zero agriculture. The development of a rice-fish-shrimp-fruit ecosystem in the Mekong Delta aligns with the government's Resolution 120 on sustainable development in the Mekong Delta in response to climate change.
Major companies in Vietnam, such as Loc Troi Group, Tan Long Group, and Thai Binh Seed Group, are collaborating with farmers to establish sustainable supply chains for the rice industry. They are gradually moving towards producing rice that meets the standards demanded by the market. This shift towards producing what the world needs, rather than what Vietnam currently has, is a crucial solution for the sustainable development of Vietnam's rice industry.
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