Rice exports open for business

The Ministry of Industry and Trade (MoIT) enacted Circular 44/2010/TT-BCT dated December 31, 2010 providing detailed guidance for some articles in governmental Decree 109/2010/ND-CP dated November 4, 2010 on rice export business. Only VFA members have thus far been eligible to export rice.

However, in the coming period the eligibility of prospective rice exporters will be based on three MoIT-regulated factors: achievements  of businesses in the last two years in prospective rice export markets, rice export performances of businesses in the last two years, and transaction documents with foreign rice importers.

VFA general secretary Huynh Minh Hue said these standardised requirements would help select capable businesses to partake in business of rice exports and avoid causing a mess in the market.

Earlier, many rice export businesses said the governmental Decree 109/2010/ND-CP effective from the beginning of this year would help restore order in the rice market and sort out good export performers.

Particularly, the Decree 109 regulates that to become eligible for rice export, businesses must have at least a specialised storehouse to accommodate not less than 5,000 tonnes of paddy rice and a husking facility with a capacity of at least 10 tonnes of paddy rice per hour.

An analysis and forecast specialist at the Ministry of Agriculture and Rural Development (MARD)’s Institute for Agricultural Development Policies and Strategies Trinh Van Tien said opening the rice export market door would benefit farmers in terms of price as more players would jump into the market.

Tien, however, noted that local firms needed to boost their storehouse capacity, ameliorate paddy rice procurement, hoarding and preservation networks and tighten ties with farmers to develop high-quality rice growing areas.

According to the deputy head of MARD’s Plantation Agency Phan Huy Thong Vietnam would produce 40 million tonnes of paddy rice in 2011, some 200,000 tonnes more than in 2010 and export six million tonnes of rice.