Ministry of Industry and Trade recommends resuming rice exports

According to the report sent by the Ministry of Industry and Trade to the Prime Minister, this agency proposed to resume rice exports but strictly control the quantity each month, first of all in April and May. This proposal was made by the Ministry of Industry and Trade after working and matching data with export enterprises, the Vietnam Food Association (VFA) and related ministries and branches such as the Ministry of Agriculture and Rural Development, and the General Department of Customs.

Specifically, the total amount of rice exported in April and May is 800,000 tons, after storing 300,000 tons in the national reserve and 400,000 tons kept for possible situations in the next 2 months. Compared to the same period in 2019, the amount of rice allowed to be exported in the next 2 months decreased by 40% and about 36% compared to the period in 2018.

In April alone, the amount of rice that can be exported is 400,000 tons of rice. The remaining amount to be exported in May will be decided by the Prime Minister in the last week of April.

The General Department of Customs is responsible for managing the 400,000 tons of rice allowed to be exported in April by adding up and subtracting the quantity according to customs declarations.

To export rice, the Ministry of Industry and Trade proposed that the Government direct the Ministry of Finance to urgently purchase enough food reserves according to the plan (300,000 tons). In addition, rice exports are only allowed through international border gates (road, rail, sea, air...) where there are sufficient network equipment for the General Department of Customs to conveniently monitor and report in real time.

In addition, the inspection team proposed that 20 large rice exporting enterprises must sign an agreement with at least one supermarket system to ensure the provision of 5% circulation reserves when requested. In case of failure to comply with the agreement, the Ministry of Industry and Trade has the right to revoke the issued Certificate of Eligibility for Rice Export Business.

Previously, at a meeting with the Government on March 23, Minister of Industry and Trade Tran Tuan Anh proposed to suspend rice exports until the end of May to ensure food security. This proposal was later approved by the Prime Minister. But just one day later, the Ministry asked the Government to resume rice exports.

Explaining the reason for the change, Mr. Tran Quoc Khanh - Deputy Minister of Industry and Trade said that due to the discrepancy in rice reserve data, especially the winter-spring rice output in the Mekong Delta among enterprises and rice growers... it needs to be recalculated.

However, in this report to the Prime Minister, the Ministry of Industry and Trade affirmed that the data on the inventory situation and rice production given by the Ministry of Agriculture and Rural Development regarding rice export output, winter-spring crop output... previously were basically correct.

Specifically, the 2020 rice crop is forecast to yield 43.5 million tons of paddy, with 6.5-6.7 million tons of rice exported in 2020. In the 2020 winter-spring crop alone, there will be about 3 million tons of commercial rice for export, which could increase by 200,000-300,000 tons due to a certain amount of rice "backed up" from the previous year.

Meanwhile, checking at enterprises, members of the Vietnam Food Association (VFA) alone, the amount of rice remaining in warehouses is more than 1.65 million tons. As of May 31, the surplus rice of VFA members is 266,000 tons. In total, enterprises outside this association, the amount of rice currently in warehouses is 1.783 million tons.

For nearly a week, when rice exports had to be stopped, businesses were "on edge". Many businesses said they were caught off guard by this sudden decision. Mr. Vu Thanh Son - General Director of Hanoi Trading Corporation (Hapro) said he did not know in advance, only when the goods arrived at the port and the declaration was opened was he notified by customs.

Similarly, two orders of Loc Troi Group on the way to the export port were also forced to wait immediately after the urgent dispatch to stop opening declarations from 0:00 on March 24. They were forced to negotiate with their partners and did not know how they would react. Unable to export, the goods were waiting at the port, incurring additional warehouse costs, and the business also faced penalties from its partners, even canceling orders when they failed to deliver on time.