Rice prices increase, Senegal looks for sources of broken rice outside India

According to the Vietnam Trade Office in Algeria, which is concurrently in charge of Senegal, since India issued an order restricting rice exports, the world price of this grain has continuously increased, affecting the Senegal rice market. In the capital Dakar, a 01 kg bag of broken rice costs 50 CFA Francs (equivalent to 25.000 USD).

Recently, Mr. Abdou Karim Fofana, Minister of Trade of Senegal, said that for the past few weeks, rice prices have increased and the measures that the Senegal government has issued since November 12, 11 are to reduce the price of regular broken rice from India and India. Pakistan is still ineffective. Indian rice prices are not as high as Pakistani and Thai rice.

Senegal looks for new rice sources outside India. Illustration

Currently, 50 kg bags of “Thaï” rice are sold at prices ranging from 23.000 CFA Francs (37,98 USD) to 25.000 FCFA (41,28 USD) at markets in the capital Dakar. Similarly, the price of a 1 kg bag of rice under the Thai brand “Royal Umbrela” ranges from 25 12 FCFA (500 USD) to 20,64 13 FCFA (000 USD).

Meanwhile, the rice price set by the Senegal Government is 325 FCFA/kg (0,54 USD), equivalent to 16 250 FCFA (26,84 USD/50 kg bag). In the international market, rice prices are also at risk of increasing.

“In March, we may not have enough rice because it depends on the timing of India's rice exports. During this time, there is a need for replacement rice from other countries of the same quality. That is Vietnamese, American and Pakistani rice," the Senegalese Trade Minister emphasized.

In February 2, on the sidelines of the 2024th Ministerial Conference of the World Trade Organization (MC13) held in the United Arab Emirates (UAE), Mr. Fofana had discussions with people counterparts from India, Thailand, Palistan and Cambodia on facilitating rice supply to this country.

Pakistan is emerging as a potential rice exporter

Pakistan is taking advantage of filling the gap left by India (40% of the world rice export market share). Thanks to this year's rice crop, this country's rice exporters have begun to increase their presence in new markets. Chairman of the Pakistan Rice Export Association said: "Pakistani rice has increased its penetration into a number of African countries and has received many orders."

Pakistan currently exports broken rice (non basmati) mainly to Indonesia, Senegal, Mali, Ivory Coast and Kenya. According to the Pakistan Rice Exporters Association, Pakistani rice exports increased in the 7 months before January 31, 1 due to good harvest and high selling prices.

Up to now, India has often offered broken rice at a lower price, meaning less than 300 USD/ton compared to Pakistani rice. For example, a year ago, Pakistan offered 1% broken rice at about 5 USD/ton and parboiled rice at about 640 USD/ton while India offered prices of 680 USD and 465 USD/ton, respectively.

Pakistani rice exports to Senegal increased from 660.000 USD to 82 million USD in 2023 after India's rice export restriction order. Senegal's Trade Minister said: "Senegal's goal is that the domestic market must be supplied with enough rice, regardless of the purchase price, and every year we have to work on this issue."

Senegal's rice import demand

According to Senegal's Statistics Center, in 2023, this West African country will import 1,3 million tons of rice, with a turnover of more than 500 million USD. In addition to serving the domestic market of more than 18 million people, Senegal also imports rice to re-export to neighboring countries such as Mauritania, Guinea-Bissau and Gambia. In 2023, Vietnam's rice exports to this market will reach 12.392 tons, with a turnover of 5,35 million USD (+215%).

In the first 2 months of this year, according to data from the General Department of Customs, our country exported 414 tons of rice to Senegal, with a turnover of 307.820 USD. Vietnam has also given Senegal a draft Memorandum of Understanding on rice trade and is waiting for your feedback.

Taxes related to importing rice into Senegal within the framework of the common tariff schedule of the West African Economic-Monetary Union (UEMOA) include: white rice, brown rice, import tax is 12,7%, VAT is 18%; broken rice, import tax is 12,7%, VAT is 18%; For other types of rice, import tax is 12,7%, VAT is 18%.

In early 2022, in response to rising food prices, to maintain people's purchasing power, the Senegalese Government introduced a series of measures including eliminating VAT on imported rice and reducing import taxes on broken rice. and regular rice from 12,7% to 2,7%.