Thailand has proposed establishing an
ASEAN Rice Exporters Alliance that consists of Vietnam, Thailand, Laos,
Cambodia and Myanmar with the aim of increasing rice export prices.
However, the proposal is facing some opposition from rice-importing countries and even in Vietnam, there are differing opinions on whether the country will benefit from joining the Alliance.
The aim of the Alliance taking shape at the end of this year is to help sharpen the competitive edge of ASEAN rice, promote information sharing and cooperation in production and marketing, and stabilize rice prices in the five countries.
The five previously mentioned ASEAN nations annually export a total
of 20 million tonnes of rice, accounting for two thirds of global rice
exports.
The International Grain Council (IGC) says that despite controlling nearly half of the global rice export volume, Vietnam and Thailand’s total share of the rice market will shrink to 38 percent later this year when India surpasses them to become the world's biggest rice exporter.
Establishing the ASEAN Rice Exporters Alliance is a response to the sharp increase in India’s rice market share after the country lifted its ban on exporting regular rice in September last year.
As the world’s biggest rice exporter, Thailand has been carrying out a costly meal replacement programme after the government decided to buy rice from farmers at a price higher than it is on the market.
Currently, Thailand has up to 16 million tonnes of rice in stock but it is still reluctant to trade for fear of inflated prices.
Vietnamese rice has gone down in price since early this year in the face of tough competition from cheap Indian rice.
The Deputy Head of the Vietnam Agriculture Institute, Professor Dr Bui Chi Buu, says that as the second most populous country in the world, India stores a large volume of rice.
To maintain its temporary stockpiles, India has to sell the old rice in stock to make room for the newly harvested rice.
By far this year, India has traded just 30 million tonnes out of its more than 40 million tonnes of rice in stock.
The global rice market has experienced wild fluctuations following India’s decision to sell 20 million tonnes of stockpiled rice at low prices.
Vietnam has no such stockpiles of rice for export since its rice is not highly graded in the world. Most of its customers are mainly low-income nations, which puts the country at a disadvantage to compete with cheaper rice from India.
In addition, experts say Myanmar will present the biggest challenge for Vietnam in the near future as it annually produces 13-14 million tonnes of rice and its government is trying to gain a leg up on the regional export market.
Some claim the Myanmar Rice and Paddy Traders Association (MRPTA) are working on export management programmes to help drive up rice prices despite the fact it is only capable of producing rice of the same quality compared to Vietnamese rice.
So, in order to boost Vietnam’s rice exports and help farmers make a profit, Vietnam needs to join the ASEAN Rice Exporters’ Alliance to avoid unfair competition through reciprocal market concessions.
The Vietnamese Government knows too well that only by helping farmers earn higher incomes and stabilize their lives can it achieve the goal of rice production and export in a sustainable manner.
However, the proposal is facing some opposition from rice-importing countries and even in Vietnam, there are differing opinions on whether the country will benefit from joining the Alliance.
The aim of the Alliance taking shape at the end of this year is to help sharpen the competitive edge of ASEAN rice, promote information sharing and cooperation in production and marketing, and stabilize rice prices in the five countries.
The International Grain Council (IGC) says that despite controlling nearly half of the global rice export volume, Vietnam and Thailand’s total share of the rice market will shrink to 38 percent later this year when India surpasses them to become the world's biggest rice exporter.
Establishing the ASEAN Rice Exporters Alliance is a response to the sharp increase in India’s rice market share after the country lifted its ban on exporting regular rice in September last year.
As the world’s biggest rice exporter, Thailand has been carrying out a costly meal replacement programme after the government decided to buy rice from farmers at a price higher than it is on the market.
Currently, Thailand has up to 16 million tonnes of rice in stock but it is still reluctant to trade for fear of inflated prices.
Vietnamese rice has gone down in price since early this year in the face of tough competition from cheap Indian rice.
The Deputy Head of the Vietnam Agriculture Institute, Professor Dr Bui Chi Buu, says that as the second most populous country in the world, India stores a large volume of rice.
To maintain its temporary stockpiles, India has to sell the old rice in stock to make room for the newly harvested rice.
By far this year, India has traded just 30 million tonnes out of its more than 40 million tonnes of rice in stock.
The global rice market has experienced wild fluctuations following India’s decision to sell 20 million tonnes of stockpiled rice at low prices.
Vietnam has no such stockpiles of rice for export since its rice is not highly graded in the world. Most of its customers are mainly low-income nations, which puts the country at a disadvantage to compete with cheaper rice from India.
In addition, experts say Myanmar will present the biggest challenge for Vietnam in the near future as it annually produces 13-14 million tonnes of rice and its government is trying to gain a leg up on the regional export market.
Some claim the Myanmar Rice and Paddy Traders Association (MRPTA) are working on export management programmes to help drive up rice prices despite the fact it is only capable of producing rice of the same quality compared to Vietnamese rice.
So, in order to boost Vietnam’s rice exports and help farmers make a profit, Vietnam needs to join the ASEAN Rice Exporters’ Alliance to avoid unfair competition through reciprocal market concessions.
The Vietnamese Government knows too well that only by helping farmers earn higher incomes and stabilize their lives can it achieve the goal of rice production and export in a sustainable manner.
1 comment:
Hey nice blog with amazing information thanks for sharing this post..
rice exporters
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