Vietnam eyes record 7mn T rice export in 2011

Exporters would ship 1 million tonnes between October and December, after 6 million tonnes estimated to have been loaded in the first nine months, Truong Thanh Phong, who was re-elected chairman of the Vietnam Food Association on Tuesday, was quoted by Tuoi Tre newspaper as saying.

The projection by the industry body, which is slightly below a forecast of 7.3 million tonnes by the Agriculture Ministry, is another step to help cool rice prices as the Southeast Asian nation struggles to control inflation.

Phong, who also heads Vinafood 2, Vietnam's largest rice exporter, was quoted as saying that rising rice prices in Thailand created good conditions for Vietnam to increase its rice export revenues this year to $3.5 billion.

Thailand's government said on Tuesday it would start buying rice from farmers at 15,000 baht ($501) a tonne in early October, about one month ahead of schedule, because some rice would be ready for harvest earlier than expected.

Last year, Vietnam exported a record 6.83 million tonnes, earning $3.21 billion, making rice the biggest cash earner among its exportable agricultural products. Rice is the staple food in the country of 87 million people where agriculture contributed 16 percent of GDP last year.

VIETNAM OUTPUT ABOVE THAILAND'S

Last month, an association official said Vietnam was capable of exporting between 7.5 million and 8.0 million tonnes in 2011, based on an Agriculture Ministry's estimate on the annual paddy output of 41.6 million tonnes, up from 40 million tonnes last year.

As such, Vietnam's output would be above the 35 million tonnes expected in 2012 in Thailand, the top exporter which ships 9 million to 10 million tonnes of milled rice annually.

The projections on Vietnam's rice output and exports were released last month by the trade ministry to address concerns over a recent rise in domestic prices and Vietnam's stocks.

Ample global rice stocks and buyers' reluctance to enter a market many see as overpriced will limit a rally that saw the staple at 1-1/2 year highs last week and raised concerns about food inflation in Asia.

Vietnamese rice export prices last month rose 10 percent from July due to limited supply and busy loading, with the 5 percent broken grain alone rising to an average of $555 a tonne, the Agriculture Ministry said in a report late last week.

It revised down the ministry's annual rice export projection to nearly 7.3 million tonnes from an earlier forecast of 7.4 million tonnes.

Annual inflation accelerated for a 12th straight month in August, hitting 23.02 percent, although economists said prices may have peaked.

Copyright Reuters, 2011