The recent dynamics in the global market, particularly India's export ban, have significantly impacted Vietnamese rice prices. Here’s a compilation of the latest updates regarding Vietnamese rice prices:
Price Increase:
The average rice export price from Vietnam during the first half of 2023 reached $539 per tonne, marking a 10.2% increase over the same period in the previous year. This increase is attributed to India's move to restrict rice exports which prompted a positive expectation among traders for a further price rise1.
Moreover, the price of Vietnam's 5% broken rice jumped to $550-575 per tonne on July 27, 2023, a significant increase from the $515-525 per tonne range in the preceding week, making it the highest price point since 20112.
Additionally, the export prices of Vietnamese rice in the initial two months of 2023 rose by 9.8% year-on-year to $528.5 USD/tonne, as reported by the Ministry of Agriculture and Rural Development (MARD)3.
Renegotiation of Prices:
Following India's ban on rice exports, Vietnamese exporters renegotiated prices for around 500,000 metric tons of rice. Consequently, prices soared to 15-year highs on the global stage. Specifically, importers from countries like Indonesia and the Philippines agreed to pay between $30 and $80 more per ton for Vietnamese fragrant rice, raising the price to around $550 per ton. The high demand and renegotiated prices also saw fragrant rice from Vietnam being offered at as high as $700 a ton, although later prices were renegotiated to around $580-$630 a ton4.
Comparison with Thai Rice Prices:
In comparison, Thailand's 5% broken rice prices were offered at $650-$655 per ton, while a similar variety from Vietnam was offered at $620-$630 per ton. Before India's export ban in July, Thai rice prices were quoted at $545 per ton and Vietnam at $515-$525 per ton4.
Impact on Consumers and Global Market:
The escalating rice prices pose a threat of food price inflation, especially affecting consumers in Asia and Africa. This price hike is exacerbated by a 20% increase in the offered prices by Asian rice exporters post India's export ban. The ban by India, which contributed to 40% of the world's rice supplies, removed 10 million tons of supplies from the international market, thus significantly impacting global rice prices4.
These updates underline a substantial upward trend in Vietnamese rice prices, majorly driven by India's export restrictions and the subsequent market reactions.