Rice prices in the Mekong Delta will continue to fall, why?

Farmers in the Mekong Delta are entering the harvest season for the late autumn-winter rice crop and preparing for the winter-spring rice crop. However, the sharpest drop in rice prices in the past 19 months has caused concern among many.

Farmers in Vinh Thuan district, Kien Giang province, are harvesting their late autumn-winter rice crop but are facing price manipulation - Photo: PHUONG DONG

On December 27th, Tuoi Tre Online reported that in the late autumn-winter rice fields of Vinh Thuan district, Kien Giang province, farmers were frustrated by brokers forcing down prices just days before the harvest.

Rice prices fall, farmers worried.

According to the family of Mr. Nguyen Thanh Phuc, residing in Vinh Thuan district, Kien Giang province, their 1.2 hectares of OM 5451 rice were harvested two days ago. About 10 days before the harvest, traders had placed a deposit at a price of 8,000 VND/kg.

"However, just one day later, they called to 'force the price' down to 7,800 VND/kg. The price difference in just 10 days resulted in a loss of about 1 million VND per hectare for the farmers," Mr. Phuc said.

Meanwhile, some households in An Bien district, Kien Giang province, reported that due to bad weather, rice yields have decreased compared to previous seasons. With falling rice prices and even lower profits, some households are at risk of losses.

According to Mr. Nguyen Van Ghi's family, residing in Thanh Yen A commune, An Bien district, they plan to harvest 1 hectare of HR 182 rice in the next 5 days. However, the current price of rice is only 7,200 VND/kg, a decrease of 1,000 - 2,000 VND/kg compared to 20 days ago.

"Last year, each plot of land yielded an average of about 1 ton of rice. This year, I expect to get only about 800 kg per plot. The cost of growing rice has increased, and the yield has decreased. I expect my family to have a low profit this season, around 20-30 million VND. As for households that rent land to grow rice, the chances of losses are very high because of the rental costs," Mr. Ghi said worriedly.

In An Giang , Mr. Dinh Thua Tu, residing in Vinh Khanh commune, Thoai Son district, An Giang province, said that this year his family cultivated 5 hectares of rice using the OM 380 variety during the winter-spring season. Currently, his winter-spring rice crop is over a month old. However, the news of falling rice prices in recent times has caused his family and neighbors more anxiety.

"In this area, farmers haven't yet established links with businesses that consume rice, so they're constantly monitoring rice prices. If the price drops below 7,000 VND/kg, farmers will struggle to make a profit. Because the price of agricultural supplies has increased, costs have also risen significantly. If the price falls below 7,000 VND/kg, farmers will certainly suffer losses," Mr. Tu said with a sigh.

Will rice prices fall further?

Mr. Nguyen Van Nghia, Deputy Director of the Department of Agriculture and Rural Development of Kien Giang province, said that Kien Giang is currently planting over 280,179 hectares for the 2024-2025 winter-spring crop. It is expected that this year's early winter-spring crop will be harvested in February.

"Generally speaking, rice prices are currently falling. However, rice prices are determined by the market, so what might fall today could rise tomorrow," Mr. Nghia said.

Meanwhile, the head of the Department of Agriculture and Rural Development of An Giang province said that An Giang has not yet harvested its rice crop. The autumn-winter rice crop has been harvested, and the winter-spring rice crop is in the heading and flowering stage. In 2024, An Giang is expected to produce over 4.1 million tons of rice. Of that, high-quality rice will account for 85% of the total 230,000 hectares.

After 19 months of price increases, Vietnamese rice prices are falling, causing concern among farmers, businesses, and the government - Photo: BUU DAU

"The department's view is to encourage farmers to actively participate in linkages with businesses for mutual benefit. However, currently, due to various factors, some areas have not yet been able to establish linkages with businesses. Therefore, farmers will be more worried when rice prices fall," this official said.

Mr. Dinh Minh Tam, director of Co May Co., Ltd. ( Dong Thap province ), said that his company specializes in exporting ST25 rice to European countries and other demanding markets. In addition, the company supplies rice to supermarket chains and stores nationwide.

Currently, the export price of 5% broken rice from Vietnam is around 485 USD/ton, lower than Thai rice. However, regardless of the price, Vietnam's rice exports are currently facing few orders and a lack of partners. Previously, the sharp increase in Vietnamese rice prices was due to a shortage of supply from India. Since India opened its market in October, export and domestic rice prices have almost returned to their previous levels.

"Before India banned exports, the export price of our rice was only $400/ton, but now it fluctuates around $485/ton. Rice prices must return to a new normal, and cannot be compared to 2023 with such an abnormal increase. Countries have large food reserves; they don't need to buy now but must sell, so there are many rice sellers in the market. Now we have to accept the rules of the game and abide by the market," Mr. Tam said.

Source: https://tuoitre.vn/gia-lua-gao-mien-tay-se-tiep-tiep-giam-vi-sao-20241227132455126.htm