Tuesday, August 5, 2008

Beras nak turun harga sikit, Dong! [#UPDATE]

Rice seller in Hanoi outdoor market
Pix:Margery H. Freeman

I blogged on the downslide price of rice in Vietnam last June as the Dong, the Vietnamese currency, was devalued at 2% as reported by the Economist. This may be good news for Malaysian consumers but bad for both Vietnamese and Malaysian farmers. There'll be "Foul" cries about, on or for subsidies.

It costs US$15 per tonne per month in interests just to store the rice.

Truong Thanh Phong, Chairman of the Viet Nam Food Association, has a lot of explaining to do:

Chairman of the Viet Nam Food Association Truong Thanh Phong spoke to Tuoi Tre (Youth) newspaper about the low price of rice in the Mekong Delta and his association’s efforts to help farmers in the area.

What is the situation with rice pricing for the summer-autumn crop in the Cuu Long (Mekong) Delta ? Why are so many companies refusing to buy rice?

Now, the price of rice is very low, and farmers must sell rice for around VND4,200-4,300 (US$0.25) per kilo. During the last winter-spring crop, when the production price per kilo was just VND2,500, farmers could sell their rice at VND5,500-6,000 ($0.3) per kilo. So now, farmers are facing serious difficulties with production alone costing VND3,500 per kilo.

In fact, all prices are increasing, but the income from rice is decreasing, leaving many farmers in dire straits. Farmers can’t sell their rice because they cannot accept such a low price, not to mention that demand is also down.

MORE at Vietnam News Agency

It doesn't make it easier for Vietnamese farmers as rice harvest season approaches for Indonesia and Malaysia and their high prices and shipping fees only compound the problem.

Vietnamese rice noodle soup

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