Following the novel coronavirus causing serious disruption globally during the opening months of the year, there emerged a growing demand for a huge volume of essential commodities, including rice, as part of a trend aimed at boosting food reserves.
According to preliminary statistics released by the General Department of Customs, the opening two months of the year saw rice exports reach 928,798 tonnes, up 31.7% on-year.
A number of markets saw dramatic increases in terms of rice export volume such as Malaysia with an increase of 149%, and China which rose by 595%. The rapid rise in terms of volume of rice exports remains the main reason behind the strong fluctuation in domestic rice prices, which underwent a surge of between 20% and 25% depending on the type.
Amid a serious saline intrusion, thousands of hectares of rice fields throughout the Mekong Delta have been adversely affected. With the nation’s capacity to produce rice reduced, the Ministry of Industry and Trade anticipates that if exports continue to increase at their current rate throughout the remainder of the year, then the country may face a shortage of rice for domestic consumption.
As a result the Ministry of Industry and Trade (MoIT) put forward a number of options for Prime Minister Nguyen Xuan Phuc to consider, including a plan to temporarily delay rice exports and another to grant rice export licenses. After considering and listening to the opinions suggested by various ministries and sectors, PM Phuc decided to temporarily suspend rice exports by the end of May 2020.
After the Notice of Conclusion of the Prime Minister was issued, the Ministry of Industry and Trade revealed opinions for localities based around the Mekong Delta necessary for them to re-evaluate their rice exports, as well as their output in terms of paddy and rice in the winter-spring crop for the year, and to calculate the actual inventories of enterprises.
In terms of the process of temporarily suspending rice exports, the MoIT have stated they will work alongside the PM, the Ministry of Agriculture and Rural Development, the Ministry of Finance, and other relevant agencies to provide information to key provinces and leading rice exporters based in Ho Chi Minh City on March 26.
Concerning the temporary suspension, Deputy Minister Tran Quoc Khanh affirms that the MoIT proposed a plan aimed at suspending and delaying rice export shipments in a bid to ensure domestic food security, as opposed to asking for an immediate halt to rice export activities.