Vietnam, Thailand to Set Prices for Rice

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Feb. 19 – The world’s biggest rice exporters have agreed to set up a joint rice-export price to limit fluctuations and strengthen competitiveness in the global market.

During a meeting between the Thai government and Vietnam Rice Cooperation in Hanoi, both signed a memorandum of understanding for fixing the export price instead of continuing a policy of price-cutting, reports The Nation.

No price has yet been set pending finalization of details to be held during the upcoming Asean Summit in Hua Hin from February 27 to March 1. “This agreement will ensure sustainable growth in rice exports, because Thailand and Vietnam are the world’s biggest rice suppliers. Rice prices will be more stable, because each country will stop undercutting prices,” said Deputy Commerce Minister Alongkorn Ponlaboot.

Vietnamese farmers will benefit the most from the agreement because this would translate to higher incomes. Rice from Vietnam has been priced lower than Thailand’s US$100 to US$200 per ton.

The cooperation will be on four levels: between governments, exporters, farmers and academic experts. Alongkorn said the two countries had not yet settled on an appropriate price, because they needed time to study all of the factors.

No joint price will be set for jasmine rice, a premium-quality variety, that only Thailand produces.

This year, rice exports have been declining by as much as 40 percent with a price drop of 50 percent. Thai rice exports will probably be lower than 600,000 metric tons in February, compared with 1.04 million tons a year earlier, Chookiat Ophaswongse, president of the Thai Rice Exporters Association, told reporters Friday.