HCMC – Indonesia’s decision to increase rice imports by an additional 1.6 million tons this year will give Vietnamese rice exporters an opportunity to step up outbound sales.
Indonesia’s Ministry of Trade said on February 26 that the move would help cope with lower domestic rice production induced in 2023 by the El Nino phenomenon, said local news reports.
With Indonesia’s total rice import quota for 2024 set at 3.6 million tons, Vietnamese rice exporters will have the opportunity to sell more to Indonesia, said the Vietnam Trade Office in Indonesia.
So far, import licenses have been issued for two million tons, with the additional 1.6 million tons expected to be authorized after administrative procedures are completed. Vietnamese rice exporters are urged to closely monitor the market.
Vietnam was Indonesia’s second largest rice supplier in 2023, with over 1.1 million tons worth more than US$640 million exported to Indonesia. Vietnamese exporters secured contracts for over 300,000 tons in the Indonesian Ministry of Trade’s recent tender for 500,000 tons of rice.
In January 2024 alone, Indonesia imported 441,930 tons of rice, an 82.19% increase from January 2023, with a value of US$279.2 million.
The surge in rice prices in Indonesia, reaching 80,000 rupiah (US$5.17) per five kilograms, compared to the government-set ceiling of 69,500 rupiah (US$4.45) per five kilograms, underscores the urgent need for more rice imports.
Indonesia braces for heightened food demand during the upcoming Ramadan festivities.
Experts said rice prices could rise further this year due to supply constraints exacerbated by India’s rice export restrictions and concerns over El Nino’s impact on rice production.
The General Department of Vietnam Customs reported that the country exported 512,265 tons of rice in January this year, with a total value of US$362.26 million. The Philippines remained the top importer, followed by France and Indonesia.
With ASEAN being the largest export market, accounting for 61% of Vietnam’s total exports in 2023, Vietnamese rice exporters are well-positioned to leverage Indonesia’s import increase and sustain their export momentum.
