Local firms would be allowed to export rice to their clients at the prices on which the two sides agree, instead of the floor prices set by the Vietnam Food Association (VFA), the Saigon Times Daily has reported.

The Government has told the ministries of industry-trade and agriculture-rural development to consider the impact of pilot removal of the floor prices on rice exports and propose appropriate management measures to facilitate export activity.

In the first four months of this year, Vietnam got 931 million USD from exporting 2.04 million tonnes of rice, down 7 percent in volume and 5 percent in revenue compared to the same period last year.

However, rice exports to the Philippines in the first quarter of this year surged six times in volume and 6.68 times in sales year-on-year, making it the second biggest importer of Vietnamese rice.

That market imported nearly 27 percent of Vietnam’s rice exports in the period after China with 38 percent.

VFA forecast rice exporting countries would face fierce competition while importing countries would increase domestic supply. Therefore, local exporters would have difficulty shipping the food staple.

Apart from pilot removal of the floor rice prices, the two ministries have been told to diversify export markets and set attainable targets.

VFA has recently revised down this year’s rice export target to 6.2 million tonnes from 6.5-7 million tonnes it announced earlier this year.

The FOB floor prices set by the VFA are 410 USD per ton for 5 percent broken rice, 375 USD per tonne for 25 percent broken rice, 365 USD per tonne for 35 percent broken rice.-VNA