February 26, 2010 / 2:33 AM / 9 years ago

UPDATE 2-Vietnam rice exports drop, demand seen from March

* Forecast fall in exports follows stockpile plan

* Top exporter Thailand also to buy rice to support market

* Fresh demand seen from the Philippines, Indonesia, Iraq (Recasts to add export data, comments, regional demand)

By Ho Binh Minh

HANOI, Feb 26 (Reuters) - Expected rice demand from nations hit by adverse weather could stem a forecasted fall in Vietnamese rice exports of as much as 41 percent in the first quarter of 2010, industry officials and media reports said on Friday.

Traders see as much as 2.05 million tonnes of potential demand, including 800,000 tonnes for the Philippines, the world’s top rice importer. [ID:nSGE61K00G]

Manila would buy 600,000 tonnes in late March, and Vietnam will prepare to fill in the remaining 200,000 tonnes, Vietnam Food Association Deputy Chairman Pham Van Bay was quoted by the Agriculture Ministry-run Nong Nghiep Vietnam newspaper as saying.

“If Vietnam can sell to the Philippines, prices will rise because all the domestic market needs is just a rising number of vessels arriving for loading,” a trader in Ho Chi Minh City said.

Separately, Indonesia may buy 1 million tonnes and Iraq is seeking 250,000 tonnes via a tender and Vinafood 1, the country’s second largest rice exporter, would bid for 125,000 tonnes, the official Vietnam Economic Times newspaper said on Friday.

The demand of 2.05 million tonnes represents about a fifth of a combined 9 million tonnes in stockpile that the world’s top rice exporters Thailand and Vietnam planned to build.

Thailand’s rice stocks could grow to 8 million tonnes from 6 million tonnes on a plan announced Thursday while Vietnam may store 1 million tonnes, with purchases taking place in March and April, traders said. [ID:nSGE61O0EH]

Q1 RICE EXPORTS DOWN

Vietnam’s rice exports in January and February fell 24.9 percent from a year ago to an estimated 781,000 tonnes, and revenues also dropped 6.8 percent to $437 million, the government said on Friday. [ID:nHAN156650]

Rice exports in the first quarter are forecast to fall by between 33-41 percent to 1.15-1.2 million tonnes, state media said on Friday. [ID:nHAN208908]

The forecast underlines a sluggish market as both foreign buyers and Vietnamese exporters, who have been allocated shipments for the Philippines at high prices, are waiting for further price falls at the peak of a major harvest, traders said.

They said the average price awarded to Vietnam via Manila’s tenders were $500 a tonne, or 9,500 dong (50.5 U.S. cents) per kg, while domestic prices for the 25 percent broken rice have fallen 34 percent so far this year to 5,500 dong per kg.

Africa also has demand for Vietnamese rice but several trading firms that dominate the African market were waiting for the winter-spring crop in Vietnam to peak so they could pressure on prices, Bay told the Agriculture Ministry-run newspaper.

He said Vietnam maintained its policy not to lower prices.

The association forecast March’s rice loading to rise to between 450,000 tonnes and 500,000 tonnes, the official Thanh Nien newspaper reported. Vietnam shipped 1.78 million tonnes of rice in the first quarter of 2009, government statistics show.

The association said on Thursday it kept unchanged the floor for 5 percent broken rice price at $440 a tonne. It has assigned 30 rice companies to stockpile 600,000 tonnes in March and 400,000 tonnes in April, the ruling Communist Party-run Nhan Dan newspaper reported. (Editing by Ed Lane)

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