Vietnam to Allow Rice Export Contracts for July Sales

By Ta Bao Long

Feb. 23 (Bloomberg) -- Vietnam, the world’s second-biggest rice supplier, will only allow new contracts for shipments from July to help stabilize prices after exports in the first half of the year exceeded a government target.

The Vietnam Food Association will register export contracts for delivery between July and September, according to a statement on its Web site today. Contracts for 3 million tons for delivery until June have been signed, topping a target of 2.8 million tons to 3 million tons for the period.

“We don’t want to be in a situation where we export too much in the first half and not have enough rice for contracts after that,” Huynh Minh Hue, the association’s acting general secretary, said by telephone from Ho Chi Minh City. “It is important to balance shipments throughout the year.”

Prices of the staple for about 3 billion people have halved from the highest-ever in April as farmers in producing countries boosted planting. India, the second-biggest grower of the grain, will harvest a record crop for a second year. Indonesia, the No.3 producer, may supply as much as 2 million tons of rice this year, the most in at least 50 years, farm minister Anton Apriyantono said in interview in October.

Vietnam plans to raise rice exports in 2009 by 6.4 percent to 5 million tons as favorable weather aids the nation’s largest harvest of the year and adequate reserves enable increased sales, Deputy Minister of Agriculture Diep Kinh Tan said Feb. 11.

More than 5 million tons of unmilled rice will be harvested this month and in March in half of the 1.8 million hectares (4.44 million acres) of paddy fields in the Mekong Delta, Agriculture Minister Cao Duc Phat said Feb. 10.

Indian Crop

India’s output of monsoon-sown rice may reach 83.3 million tons, while the winter-sown crop may rise 3 percent to 14 million tons, according to the farm ministry. State warehouses had 17.57 million tons of rice on Jan. 1, more than the minimum requirement of about 11.8 million tons, the government said last week.

Rough rice for May delivery fell 0.3 percent to $11.99 per 100 pounds in after-hours trading on the Chicago Board of Trade. The price touched a record $25.07 last April as Vietnam, India and Egypt curbed exports to protect domestic stockpiles and cool prices. The gains caused food riots from Haiti to Egypt.

To contact the reporter on this story: Ta Bao Long in Hanoi at longta@bloomberg.net.