Rent land for farming when rice prices are high.
After harvesting the 2023 summer-autumn rice crop, Mrs. Tran Thi Nga's family (Nga Nam town, Soc Trang province) sold their rice at 7,000 VND/kg, earning a profit of 15 million VND. With rice prices still rising sharply, Mrs. Nga decided to rent more land to expand her planting area in hopes of earning more profit.
According to Ms. Nga, since harvesting the summer-autumn rice crop, she has searched for and rented 2 acres of land from an acquaintance at a price of 3 million VND per acre, in addition to her existing 5 acres of land, to plant the 2023-2024 winter-spring crop.
“At first, I thought the price of rice would stop rising after around 8,000 VND/kg, but unexpectedly, it kept increasing. When I was looking to rent land, the price had already risen to over 8,000 VND/kg. Predicting that the price would continue to rise, I decided to rent land to plant rice hoping to make a profit. The high price of rice is a blessing from heaven, so I'm taking advantage of the opportunity to make as much profit as possible,” said Mrs. Nga.
Not only Ms. Nga, but Mr. Nguyen Van Nghia (Thoi Lai district, Can Tho city) also decided to rent rice fields to increase his planting area. However, because so many people were looking to rent, this farmer lost his chance, and the land price also increased significantly.
“Right now, traders are putting down deposits at my place for 9,400 VND/kg, nearly 3,000 VND higher than last year. I was also thinking of renting land to grow crops for profit, but it's very difficult to find because many people are renting, and the land price, which used to be 2-2.5 million VND/hectare, has now risen to 3-3.5 million VND/hectare. I find the land rental price quite high, so I don't dare rent it, because I'm afraid that if I rent it and cultivate it, I won't make much profit,” said Mr. Nghia.
Hesitant due to fear of risk.
Having just harvested his winter-spring rice crop, yielding nearly 9 tons and selling at 9,800 VND/kg, Mr. Nguyen Van Phuong (Ke Sach district, Soc Trang province) was overjoyed and excited to have earned a profit of 20 million VND more than the previous year. However, this farmer decided not to rent land but to focus on cultivating only the land his family already owns.
Mr. Phuong explained: "The current land rental price in my area is 3-3.5 million VND per hectare. If the price of rice is high, from 9,000 - 10,000 VND/kg, then each hectare, after deducting material costs, yields a profit of 5-6 million VND. Even after deducting the 3 million VND land rent, there's still a profit. However, if the price of rice drops in the future, there could be significant losses."
According to Mr. Phuong, the fluctuating rice market is an opportunity for farmers to change their lives after many years of toiling in the fields. However, investing in land leasing without careful planning can easily lead to risks.
"Farmers live off rice, and who wouldn't be happy to see high prices? Renting land to grow rice for profit is obvious because farmers work hard all year round and only occasionally get high rice prices. However, paying to rent land regardless of rising land prices could lead to heavy losses if not planned ahead," said Mr. Phuong.
Ms. Nhu Ha (Long My district, Hau Giang province) said: “Now that rice prices are high, traders are very accommodating to farmers, not forcing prices down, and competing to pay deposits in advance. But if rice prices fall, we have to go find traders and accept being forced to accept lower prices. Therefore, I don't dare rent more land to plant, even though I know I could make more profit, but safety is still better.”
According to the Vietnam Food Association, rice prices on January 25th fluctuated inconsistently by 100-300 VND/kg. In An Giang, OM 5451 rice was priced at 9,300-9,400 VND/kg, a decrease of 200 VND/kg; OM 18 rice increased by 100-300 VND to approximately 9,500-9,600 VND/kg; and Nang Hoa 9 rice saw a slight decrease of 100 VND/kg to approximately 9,800-9,900 VND/kg.
At export warehouses, rice prices remained stable. Accordingly, the price of Vietnamese IR 504 raw rice remained at 13,050 - 13,150 VND/kg; raw rice fluctuated between 12,900 - 13,000 VND/kg; and Soc Trang raw rice was at 12,250 - 12,350 VND/kg.
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