Vietnam, which resumed rice imports from India just after decades obtaining decreased priced 100 per cent damaged variety, has now started to purchase superior high-quality grades to satisfy its other domestic needs.

“Vietnam is purchasing five per cent damaged white rice from us since its output is decreased. This five per cent damaged is used for provide to its defence forces and industrial consumers,” mentioned M Madan Prakash, Agri Commodities Exporters Affiliation (ACEA) President.

Vietnam has bought the five per cent brokens at $410-420 a tonne (₹ thirty,800-31,550) a tonne, mentioned Prakash, whose Chennai-based Rajathi Team exports agricultural generate.

“Vietnam is purchasing 10 per cent brokens also from us. It has been purchasing constantly from us like China. Its regular imports of rice are all over one lakh tonnes,” mentioned B V Krishna Rao, The Rice Exporters Affiliation (TREA) President.

The US Section of Agriculture (USDA), in its grain and feed annual report, mentioned that Vietnam has bought 100 per cent damaged rice from India at $310 ( ₹23,three hundred) a tonne, at minimum $130 (₹9,775) decreased than its have presents of damaged rice.

100 per cent damaged rice imports

Between December very last calendar year and January, Vietnam had imported about sixty five,000 tonnes of the 100 per cent damaged rice from India, the USDA mentioned quoting Hanoi Customs data. The rice was imported for getting ready rice noodles, processing flour, brewing, and feed production.

While the USDA mentioned that Vietnam would import five lakh tonnes (lt) during the latest internet marketing calendar year ending July, TREA’s Rao mentioned the South-East Asian country could import about 10-12 lakh tonnes of rice at the level of one lakh tonnes a thirty day period.

“Vietnam is focussing only on manufacturing premium types only that fetch very good price ranges in the international sector,” mentioned ACEA’s Prakash.

The USDA mentioned that Vietnam large high-quality rice cultivation enhanced to seventy four per cent very last calendar year, up 24 share details above the very last five several years.

Vietnam’s paddy output

Quoting Hanoi’s Typical Figures Office environment, the USDA mentioned that Vietnam’s paddy output continued to decline thanks to urbanisation, crop alteration, drought and salinity intrusion impression inspite of higher yield.

Location less than paddy in Vietnam has dropped from 7.three million hectares (mh) in August 2019- July 20 to 7.25 mh this season. This is expected to be preserved next season. Yield has enhanced to 5.nine tonnes a hectare from 5.88 during the same period of time. Generation is approximated at forty three.36 million tonnes (mt) this season, the same as very last season. Future season, also, the USDA sees the output at the same amount.

According to S Chandra Sekaran, a New Delhi-based trade plan expert, the Mekong delta in Vietnam is drying up with erratic local weather compounding the difficulty. “Vietnam has started to depend on Indian rice. The dominance of Vietnam and Thailand in the rice sector could not proceed as previously,” he mentioned.

Prakash mentioned India relished an advantage in the international sector since its price ranges ended up competitive. According to the USDA, India’s choices ended up competitive by above $100 ( ₹7,500) a tonne.

According to the Intercontinental Grains Council, Vietnam’s five per cent damaged is presently quoted at $491 a tonne and Thailand’s same grade at $483. India’s 25 per cent damaged rice was quoting at $419 a tonne, it mentioned. Year-on-calendar year, Indian rice price ranges have obtained fourteen per cent, while Vietnam rates have obtained thirteen per cent.

Vietnam’s large price ranges have resulted in its rice exports dropping to a five-calendar year minimal during January-February. China diversifying its rice import basket to include things like India, Myanmar and Cambodia has also extra to its issues, the USDA mentioned.

TREA President Rao mentioned that with the rupee dropping three per cent towards the US dollar, there could be a rate adjustment to the tune of $10 ( ₹750) a tonne.

“The new crop has started to arrive in Telangana and Andhra Pradesh. Traders are waiting for the trade level to stabilise. They could start off purchasing above the next handful of days,” he mentioned.

Worldwide rice sector

Final fiscal, India relished an advantage in the international rice sector as it had massive carryover stocks that ended up even more boosted by a record output. The country’s rice output in 2019-2020 (July-June) was 118.forty three mt.

As on April one very last calendar year, the Foods Corporation of India (FCI) had 32.24 mt of rice as stocks, moreover 25.24 mt of paddy that could yield sixteen.90 mt of rice. The FCI had 28.23 mt of rice and 34.5 mt of paddy that can yield 23.10 mt of rice in March this calendar year.

In addition, rice output this season to June has been projected at a record a hundred and twenty.32 mt.

According to the USDA, India’s rice exports capabilities have been enhanced by operation of deep-h2o port at Kakinada since February this calendar year.

TREA’s Rao mentioned that just after the Andhra Pradesh federal government allowed the deep-h2o to be used for exports, the waiting time for the vessels has dropped sharply and shipments speeded up.

India’s rice exports are expected to maintain the same momentum as very last calendar year, nevertheless soaring ocean freight rates could sluggish it for some time in the beginning.