November 5, 2007
Vietnam fails to capitalize on global rice shortfall
Bob Papanos, the publisher of The Rice Trader, told a recent meeting in Indonesia titled “International Rice Trade” that India had decided to scrap its plan to export 3.5 million tons next year. Meanwhile, the demand for the cereal was rising because the prices of wheat and corn had more than doubled recently, he added.
Major rice exporting countries were unlikely to fill the gap, he said. Additional shipments from Thailand and Cambodia next year could only make up 1 million tons, he added.
In this scenario, no one can predict how high the prices might rise next year.Analysts at the meeting said Vietnamese farmers were at a disadvantage because the government had halted all exports to boost reserves after severe floods raised supply concerns.
Moreover, Vietnam has said its paddy output might drop 0.7 percent to 35.6 million tons in the crop year starting February next year because of bad weather and farmers converting some of their fields into fish farms and growing other crops. The demand for fragrant rice varieties, such as hom mali from Thailand and basmati from India and Pakistan, is also on the rise despite their higher prices. This is Vietnam’s weakness since farmers here are not keen on fragrant varieties. It is essential that agricultural institutes make efforts to create a major strain of fragrant rice and farmers shift to growing this variety. The government and the Vietnam Food Association should focus on investing in such activities.