Export prices will continue to increase slightly this month, said Thuy. "Demand for importing rice is rising in many countries while production of major rice exporters including Vietnam and Thailand tends to be slow at this time due to unfavourable weather conditions.

"Currently, domestic supply is low as the winter/spring crops haven't been harvested and farmers have ceased selling as they are waiting for higher prices," he said. "This is causing difficulties for enterprises wanting to fulfill their export contracts."

At the home market, prices are at their highest ever and will continue to rise in the coming months, according to Thuy. Prices last week ranged between VND7,600 and VND11,000 ($0.5-0.7) per kg in the northern province of Thai Binh, and VND6,500-13,000 ($0.4-0.8) in the northern port city of Hai Phong.

So far this year the country has exported 381,000 tonnes of rice, up by 47% from the same period last year. Export earnings reached $150mil, up by 78%.

"Export volume increased sharply from last year but it still stood at a low level in five years due to last year's small figure," Thuy commented.

According to Thuy, total world rice import-export volume is expected to reach 29.4mil tonnes this year, up 2.1% from last year. Asia's imports will increase 7% to reach 13.5mil tonnes.

Meanwhile, the falling dollar was creating pressures on exporters, Thuy said, citing a director of a rice export company as saying, "while enterprises' buying prices have increased, export turnovers are likely to decline due to the falling dollar."

Deputy Minister of Industry and Trade Nguyen Thanh Bien said last month that the Government should carefully regulate this year's rice exports as crops in the northern provinces were likely to suffer because of a prolonged winter spell.

Prime Minister Nguyen Tan Dung has set a target/limit of 4.5mil tonnes in rice export volume for this year. The figure will be adjusted at the beginning of the third quarter based on the Ministry of Agriculture and Rural Development's reports on crops' results.

The State Bank of Viet Nam will direct commercial banks to actively balance capital sources to meet the demand for borrowing to buy rice for selling at home and abroad, said Dung.

According to Thuy, the Thai Rice Exporters Association and the Viet Nam Food Association plan to meet in Bangkok to discuss rice prices on the world market.

An official from the Ministry of Agriculture and Rural Development, Phan Huy Thong, last month said rice for export in the country would be available as of March or April given that the southern provinces had reported a bumper winter/spring crop.

(Source: Viet Nam News)