Ministry responds to proposal on suspension of rice exports

Hanoi (VNA) - Concerning the suspension of rice exports, Deputy Minister of Industry and Trade Tran Quoc Khanh told the media on March 25 that the ministry wants to review the rice stock by farmers and businesses, as well as the signed export contracts.

- The General Department of Vietnam Customs issued a document ordering the suspension of rice exports, but the MoIT still asked for shipments to be continued. Could you provide official information about this?

Deputy Minister Tran Quoc Khanh: In the first months of 2019, the COVID-19 outbreak has been causing extremely serious impacts on not only Vietnam but also the whole world.

In fact, demand for some essential goods, including rice, is increasing rapidly and countries are also beginning to stock up on food to ensure their people’s daily needs are met. Given this, prices in the global market have been fluctuating strongly.

[PM orders suspension of signing rice-exporting contracts]

The MoIT’s data show that in the first two months, Vietnam’s rice export volume reached some 930,000 tonnes, up 32 percent from the same period last year. Domestic prices have also fluctuated in line with changes in the world market and increased by 20 – 25 percent depending on rice types.

In this situation, if export still continues at the pace like in the first two months and March, Vietnam may face the risk of lacking rice for domestic consumption. Therefore, the ministry proposed some plans to the Prime Minister, including extending time for rice delivery and granting export licenses.

After considering the views of ministries and sectors, the Prime Minister decided to temporarily extend the time for rice delivery until the end of May. Basing on this, the General Department of Vietnam Customs gave the export suspension order to local customs departments.

However, after the general department requested local customs departments to do so, the MoIT has received feedback from some businesses and localities who said there were differences between statistics of the MoIT and those of localities, especially in terms of the output of the winter-spring crop in the Mekong Delta and the rice volume stored by farmers and businesses.

The statistical differences are understandable since in the past, we could have a good grasp of the rice output, the volume in contracts and that in inventory thanks to information from the Vietnam Food Association.

However, since Decree 107/CP was issued in 2018, the ministry has no longer been updated on these data because businesses do not have to inform the export volume in signed contracts, the amount already exported or the unsold inventory.

For this reason, the MoIT has asked the Prime Minister to allow reviewing the inventory by farmers and businesses and the signed export contracts for reporting to him to make decisions.


- What are statistical differences as reported by businesses?

Deputy Prime Minister Tran Quoc Khanh: Businesses said that exports became stagnant in March and the amount was not as large as what the ministry estimated.

Besides, some province and companies said rice stocks of farmers and businesses’ reserves could be higher than the data recorded by the MoIT.

As I had mentioned earlier, we used to have tools to gain accurate statistics, but since 2018, when we decided to liberalise the export of rice, the MoIT no longer has those tools. It now obtains the data from official sources of the Ministry of Agriculture and Rural Development and the Food Association.

Since there could be certain differences, the ministry asked the Prime Minister for permission to re-verify all of those statistics and report to him. The specific figures will be clarified at the coming working session among the ministry, localities and businesses.

- What will the MoIT do next? Has the ministry had any response plans if the COVID-19 pandemic lingers on?

Deputy Minister Tran Quoc Khanh: The national reserves have been geared up for the case that the pandemic lingers on, and the Prime Minister issued directions in this regard in Conclusion 121/TTg, requesting the Ministry of Finance to beef up the national reserves.

Besides, Decree 107/CP also requires businesses to put aside a reserve equivalent to 5 percent of the rice volume they export. If businesses comply with this rule seriously, we will have an amount of rice reserved by enterprises.

The MoIT has prepared for all scenarios so as to prevent any goods shortages in any places. Additionally, rice crops in Vietnam grow relatively fast, so the production of the grain can recover in a short period of time and meet domestic demand.

Considering all those factors, the MoIT believes that even if the pandemic lingers on, we are still able to guarantee the national food security. However, the pace of export must be controlled because if rice is shipped abroad at the speed in the first two months, Vietnam could face the risk of rice shortage. Hence, amid the pandemic, food security needs to be put above all.

- Thank you very much./.