The Guardian 30 April, 2008
Vietnam curbs rice exports
The Vietnamese government has decided to cap rice exports at 3.5-4 million tonnes in 2008, down from the country’s shipment of 4.5 million tonnes in 2007, in a move to lower skyrocketing food prices, which were now driving double-digit inflation, and to secure food security.
Food prices account for some 43 percent of the basket Vietnam uses to calculate its consumer price index, which posted a year-on-year rise of 16.38 percent in the first quarter of this year.
In addition to capping export volume, the government has asked businesses not to sign new rice export contracts until June. Local exporters must ensure that their rice export contracts for the first half of this year would not exceed 50 percent of the average shipments over the past two years.
Rice prices in the world market have increased by 50 percent in the last two months, heavily impacting life of people in Asia where rice is a staple food. The prices were expected to rise by 40 percent in the coming months, according to the Trade Information Centre under the Vietnamese Ministry of Industry and Trade.
The price hike was mainly due to soaring costs of petroleum products and fertilizers. Another reason for the limitation is that a long cold spell lasting from mid-January to late February has damaged most of the acreage of the Winter-Spring crop in the northern region, lowering the region’s rice output by 100,000-200,000 tonnes, said chairman of the Vietnam Food Association Truong Thanh Phong.
The global rice reserve was estimated at 72 million tonnes between 2007 and 2008, the lowest since the 1983-1984 period and half of the peak in the 2000-2001 period, according to the US Department of Agriculture.
Xinhua