Delta farmers cash in on rice prices

Posted at VNN

March 23, 2009

VietNamNet Bridge - The Cuu Long (Mekong) Delta is entering the peak harvest season for the winter-spring rice crop, with the price of rice continuing to increase as demand for exports remains high.

Tran Van Hai, a farmer in Can Tho City’s Thoi Lai District, said he had harvested two hectares of long-grain rice OM 1490 with a total output of 13.6 tonnes.

"At the current price, I can earn a profit of about VND55 million (US$3,200) for my two hectares of rice, but I will wait for rice prices to go up," Hai said.

Hoang Kim Cuong, head of the Thoi Lai District Agriculture and Rural Development Department, said farmers were harvesting a bumper winter-spring crop and earning high profits as production costs fall and rice prices increase.

Cuong said all harvested rice in the district had been bought by the district-based food companies.

"My family and other farmers here are very glad about the harvest of the winter-spring crop as we can sell all of our rice at a high price," said Luong Hong Thien, a farmer in Dong Thap Province’s Tan Hong District.

With the lower production costs and increase in rice prices, farmers can earn profits of VND2,000-2,100 a kg on the winter-spring crop, according to local authorities.

The delta, the country’s ricebowl, has harvested more than 30 per cent of the total of 1.54 million hectares of the winter-spring crop.

High demand

Huynh Minh Hue, acting general secretary of the Viet Nam Food Association (VFA), said under the instruction of the Government to increase the number of rice export contracts earlier this year, more contracts had been signed in the first three months of the year.

However, some food companies have lost $10-15 for a tonne of exported rice since the beginning of the month as they failed to predict the increase of rice prices when they signed export contracts at low prices early this year, said Hue.

He said food companies suffered losses because they lacked warehouses to buy rice for stock before they signed export contracts.

Nguyen Thanh Bien, deputy minister of Industry and Trade, said the rice quantity of export contracts signed in the first two months of the year was very large.

The quantity of rice that must be delivered under signed export contracts from now to the end of June would be about 2.7 million tonnes, Bien said.

Viet Nam exported a total of 1.05 million tonnes of rice worth $479 million in the first two months of the year, an increase of 2.2 times in volume and 2.5 times in value over the same period last year, according to the Ministry of Agriculture and Rural Development.
VietNamNet/VNS