The autumn-winter harvest is not much, so supply is scarce, while the demand for Tet rice is high, leading to sales, pushing the price of ST25 rice up every day. The increase in ST25 rice prices caused some export contracts to be canceled to China.

ST rice varieties are grown a lot in the provinces: Bac Lieu, Soc Trang and Ca Mau. This Fall-Winter season, the provinces sow about several thousand hectares, and this season is also the rice-shrimp season, so the sowing area is relatively good. In the Winter-Spring season, the weather is more favorable than the Fall-Winter season, so the area planted with ST rice is the largest in the year.

ST25 rice in the Fall-Winter crop is being sold at a price of 12,000 VND/kg. The price of rice has increased but the unharvested rice area is not much left, so the phenomenon of rice storks "fighting each other in the field" occurs.

Depleted supply pushes the price of ST25 rice to increase "dizzily"

A representative of a company exporting rice to China said that the sharp increase in ST25 rice prices makes it difficult for companies making goods to China, because when they signed to sell domestic ST25 rice prices were from 810-840 USD/ton, but now has increased to 950-960 USD/ton, compared to the price at the time of signing the sale, there was a difference of more than 100 USD/ton. Still unable to buy goods, so some export contracts to China were canceled, although these contracts were The volume is only about 2,000 tons, mainly the old quota extended for 2023, but the extended quota must be shipped before Tet.

However, due to not being able to buy goods and because prices increased too high, some businesses were forced to not deliver goods to Chinese partners even though they knew that doing so would affect the company's reputation.

With the rhythm of rice price increases as in 2023, contract cancellations will be quite common and force majeure, not only in the Chinese market, many rice contracts going to the Philippines will also be canceled.

"Rice price developments in recent times have made the situation more complicated and unpredictable, leading to the cancellation of rice export contracts which can be said to be quite common in 2023, because if the increase is below 1,000 VND/kg, businesses The industry can cope (but only a little), if it increases from 3,000-4,000 VND/kg, it will no longer deliver, and the contract cancellation situation is likely to spread to the first months of 2024.

2023 can be said to be a difficult business year for rice export businesses, making a lot of losses. Back in April-May 2023, if every 1,000 tons of fragrant rice was delivered, the loss would be 3-4 Billion VND, which business can afford it?", representative of a rice export company in the city. Ho Chi Minh shared.

The situation of domestic rice prices increasing sharply before Tet this year just happened

Sharing the same opinion as above, a business in the Mekong Delta shared that at this point, the Fall-Winter rice crop has basically been harvested, with only a few scattered areas remaining in the lower regions, such as Bac Lieu. , Ca Mau, and the Winter-Spring crop will not be harvested until mid-January 2024 in some localities of Vinh Long and Dong Thap provinces.

However, due to erratic weather conditions in the Fall-Winter season, productivity and output of ST25 rice are low, leading to a limited supply that is not enough to meet demand, causing rice prices to increase, of course, but the price situation is The "hot" increase in domestic rice before Tet only happened this year.

With the current high price of rice, the price of ST25 rice sold at supermarkets must also increase to 50,000 - 55,000 VND/kg to be profitable, but consumers will not accept such a high price. The organic ST25 rice line currently costs from 60,000 - 70,000 VND/kg, while ST25 rice sold at the market costs about 25,000 VND/kg but is mixed a lot.

"The West has two large rice markets, Cai Be and Sa Dec, specializing in selling domestic rice. Any day there are a lot of buyers and they realize that the market has the ability to absorb goods, the sellers are ready to push prices up. There are few buyers and if there is no product, they lower the price. For rice export businesses, they now order goods at a fixed price. Whoever sees the supply can sell and they will buy until they buy enough quantity, then the ship will come in to receive the goods. Now the rice goes to Cuba. and in the Philippines, export businesses place orders for delivery to the ship's side," the business said.

This business added that the price of Vietnamese rice is still higher than the price of domestic rice in China, so businesses cannot export to this market but only sell sticky rice and a little DS1 short-grain rice. However, there are still some northern businesses going to the West to buy ST25 rice to sell in the Chinese New Year market, but because the price is too high, they sell unprofitably and mainly sell to keep deals.