High rice prices, some rent land to grow for profit, others fear loss

Renting land to grow rice when rice prices are high

After harvesting the 2023 Summer-Autumn rice crop, Ms. Tran Thi Nga's family (Nga Nam town, Soc Trang province) sold the rice for 7,000 VND/kg, earning a profit of 15 million VND. Rice prices continued to increase sharply, so Ms. Nga decided to find land to rent to increase the planting area, hoping to earn more profit.

According to Ms. Nga, since finishing the Summer-Autumn rice harvest, she has found and rented 2 hectares of land from an acquaintance, priced at 3 million VND/hectare, plus 5 hectares of existing land to plant the Winter-Spring crop 2023 - 2024.

“At first, I thought that the rice price would stop increasing at around 8,000 VND/kg, but I didn’t expect it to increase continuously. When I was looking to rent land, the rice price had already risen to over 8,000 VND/kg. Predicting that the price would continue to increase, I decided to rent land to grow rice, hoping to make a profit. The high rice price is a blessing from heaven, so I took advantage of the opportunity to make as much profit as possible,” said Ms. Nga.

Not only Mrs. Nga, Mr. Nguyen Van Nghia (Thoi Lai district, Can Tho city) also decided to rent rice fields to increase the planting area. However, because there were too many people looking to rent, this farmer lost his turn, and the land price also increased significantly.

“At this time, traders deposit 9,400 VND/kg with me, nearly 3,000 VND higher than last year. I also plan to rent land to grow for profit, but it is very difficult to find because there are many people renting, land prices from 2-2.5 million VND/cong now increased to 3-3.5 million VND/cong. I think the land rental price is quite high so I do not dare to rent, because I am afraid that if I rent it, I will not make much profit” - Mr. Nghia said.

Hesitant because of fear of risk

Having just finished harvesting the Winter-Spring rice crop with a yield of nearly 9 tons and a selling price of 9,800 VND/kg, Mr. Nguyen Van Phuong (Ke Sach district, Soc Trang province) was very happy and excited when his profit increased by 20 million VND compared to last year. However, this farmer decided not to rent land but only focused on cultivating the existing land of his family.

Soc Trang farmers harvest winter-spring rice 2023 - 2024. Photo: Phuong Anh

Mr. Phuong explained: “The land rental price in my area is currently 3-3.5 million VND/cong. If the rice price is high, from 9,000 - 10,000 VND/kg, each cong after deducting material costs will make a profit of 5-6 million VND. Continuing to deduct the land rental fee of 3 million VND will still be profitable, but if the rice price drops in the future, there may be a heavy loss.”

According to Mr. Phuong, the fluctuating rice market is an opportunity for farmers to change their lives after many years of working hard. However, investing in land without careful planning can be very risky.

“Farmers live on rice, and who wouldn’t be happy to see the high price of rice? Renting land to grow rice for profit is obvious because farmers work hard all year round and only get high prices every now and then. However, paying rent for land, regardless of the increase in land prices, can lead to heavy losses if not calculated in advance,” said Mr. Phuong.

Ms. Nhu Ha (Long My district, Hau Giang province) said: "Now the price of rice is high, traders pamper farmers, do not force the price, compete to deposit money in advance. But if the price of rice drops, we have to find traders, accepting the pressure on the price. Therefore, I do not dare to rent more land to grow, even though I know I can make more profit, but safety is still better."

According to the Vietnam Food Association, rice prices on January 25 fluctuated 100 - 300 VND/kg. In An Giang, OM 5451 rice was priced at 9,300 - 9,400, down 200 VND/kg; OM 18 rice increased by 100 - 300 VND to around 9,500 - 9,600 VND/kg; Nang Hoa 9 rice had a slight decrease of 100 VND/kg to around 9,800 - 9,900 VND/kg.

At export warehouses, rice prices remained unchanged. Accordingly, the price of IR 504 Vietnamese raw rice remained at VND13,050 - 13,150/kg; raw rice fluctuated at VND12,900 - 13,000/kg; and Soc Trang raw rice was at VND12,250 - 12,350/kg.

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