The export price of 5% broken rice has dropped to 434 USD per ton, the lowest in 4 years, causing domestic rice prices to also fall, causing difficulties for businesses and farmers.
Data from the Vietnam Food Association shows that since the end of 2024, the price of 5% broken rice has continuously decreased from 624 USD per ton to 434 USD - the lowest since 2021. At this price, Vietnam is the country with the cheapest rice price among the top 4 rice exporting countries in the world , including Thailand, India, and Pakistan. The prices of 5% broken rice of the above countries are 479, 440, and 448 USD per ton, respectively.
The plummeting export price of rice has also caused the price of paddy in January to continuously decrease. The average price of ordinary paddy in the field is over 6,400 VND per kg, down nearly 300 VND compared to the end of December 2024; the average price of ordinary paddy in the warehouse is 7,400 VND per kg, down more than 400 VND.
Mr. Hoang, a rice farmer in Can Tho , said that the winter-spring rice crop in this area will not be harvested until after Tet, but people are worried that if prices continue to fall, his family may suffer losses this season due to high input costs.
According to Mr. Hoang, the sharp drop in rice prices has made traders hesitant to sign contracts with farmers. "Last year, at this time, traders continuously placed high deposits, but now no one is asking to buy. Many traders have taken Tet holidays early," said Mr. Hoang.
The leader of a rice exporting enterprise in An Giang said that the enterprise is completing previously signed contracts. Meanwhile, contracts for rice in the first and second quarters of 2025 are being delayed because new rice has not been purchased from farmers. On the other hand, rice prices fluctuate continuously, so enterprises are worried about losses if they buy rice at high prices.
"We are observing the market situation and actual demand to purchase rice at reasonable prices," he shared.
Reasons for the sharp drop in rice export prices comes from many factors, including major rice importing countries studying savings policies, avoiding high import prices, and even declaring not to buy rice in 2025.
The leader of the Vietnam Food Association also said that in 2024, Vietnam's two major rice consuming markets, the Philippines and Indonesia, have increased imports, helping to ensure short-term inventories for food security, so they are not in a hurry to buy at this time and are waiting for prices to drop.
In addition, India's reopening of rice exports with abundant supply and cheap prices has impacted the world market, including Vietnam. Recently, there is information that the Philippines is negotiating to sign a contract to import more rice from India. Private customers from the Philippines often buy Vietnamese rice in limited quantities due to financial balance, capital turnover or bank debt repayment, causing the market to calm down.
In the coming time, when the 2024-2025 winter-spring crop enters its peak harvest, rice prices will be affected more. According to businesses, the prices of 5% and 25% broken rice from Vietnam and the world are likely to decrease further in 2025, due to pressure from cheap rice from India. The sharp decrease in low-grade rice may drag down the high-quality, fragrant rice segment, especially when this supply is increased.
According to the forecast of the US Department of Agriculture (USDA), the global rice supply this year will increase significantly, with output expected to reach a record of more than 530 million tons, an increase of 3.1 million tons compared to the previous forecast.
This increase is mainly due to India lifting the ban on non-Basmati white rice exports, which is expected to export 21-22 million tonnes of rice in 2025, up 5 million tonnes from 2024.
Apart from India, countries such as Egypt, Guyana, Japan and Venezuela are also expected to increase production, while the Philippines is the exception with a forecasted decline in production. To maintain and expand market share, exporting countries need to be flexible in their market access strategies, improve product quality and seek new markets.
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