High expectations can be a warning sign of risk factors.

Chairman of the Vietnam Food Association, Nguyen Van Nam, shared: “Vietnam’s rice exports have made remarkable progress in recent years. We have continuously strived to improve product quality, diversify export rice types, and expand into new markets. As a result, Vietnam has affirmed its position as the world’s number one rice exporter.”

With impressive results in the first half of the year, businesses and experts alike expect Vietnam's rice exports to continue to thrive in the second half of 2024.

Currently, global food consumption and stockpiling remain high, while supply is tight due to economic and political instability and climate change. With increased rice imports from many countries, especially from traditional markets for Vietnamese rice such as the Philippines, Indonesia, Malaysia, and some African countries, export rice prices will recover, continuing to create significant opportunities for Vietnamese rice export businesses in particular and for the development of Vietnam's rice industry in general.

In the Philippines, rice imports are projected to reach 4.5 million tons in 2024, higher than previous forecasts. Vietnam currently accounts for 85% of the imported rice market there. Indonesia forecasts its rice import demand to increase to 5.18 million tons in 2024, creating significant opportunities for Vietnamese rice exporters. Vietnamese rice exporters are also actively expanding into new markets such as Africa and the Middle East to capitalize on the growing demand.

In its June 2024 report, the U.S. Department of Agriculture (USDA) continued to forecast Vietnam's rice exports for the 2024-2025 crop year at approximately 7.5 million tons, primarily driven by strong demand from several Asian and African countries amidst extreme weather conditions caused by La Nina and climate change. While demand for rice is increasing worldwide, the global rice supply is becoming tighter than before due to the impact of climate change.

Rice exports from some major exporting countries like Thailand in the 2024-2025 crop year may continue to be limited due to drought conditions caused by the El Nino phenomenon. This context supports the prevention of sharp declines in Vietnam's domestic and export rice prices and may lead to a recovery in the near future.

Vietnam's rice exports in 2024 are expected to continue to maintain the level above 8 million tons – the record rice exports Vietnam achieved in 2023 – and will also bring in outstanding export revenue, reaching the target of over 5 billion USD.

Many unpredictable factors remain.

However, according to the National Center for Meteorological and Hydrological Forecasting, the number of typhoons and tropical depressions in the second half of 2024 may be close to the annual average and is likely to be concentrated in the latter half of the rainy season. From July to September 2024, typhoons and tropical depressions will affect the northern provinces, and from around September to December 2024, they will affect the central and southern provinces. Therefore, localities need to promptly update meteorological and hydrological forecast information and take proactive measures to prevent and mitigate natural disasters, minimizing the impact on rice production.

On the other hand, India currently exports more than 40% of the world's total rice. If India lifts or eases its export ban, it will drive down the price of rice in major exporting countries around the world, including Vietnam.

Furthermore, Indian officials have also proposed reducing the 20% export tax on parboiled rice. Analysts believe that any decision to ease export restrictions by India could help cool down benchmark rice prices in Asia. Therefore, the competitive pressure on Vietnamese rice exporters will intensify, while they are already competing with major rivals such as Thailand and Pakistan.

According to Nguyen Nhu Cuong, Director of the Department of Crop Production (Ministry of Agriculture and Rural Development), global rice demand remains high and production is not in surplus. Therefore, if India lifts its restrictions on white rice exports, it will have little impact on Vietnam's exports. However, adjusting India's rice export ban will bring about significant fluctuations in the global rice market. Vietnamese businesses need to closely monitor the situation to proactively respond and seize opportunities in the coming period.

According to Tran Thanh Hai, Deputy Director of the Import-Export Department (Ministry of Industry and Trade), rice prices have decreased but remain relatively high, still favorable for Vietnamese businesses exporting rice. Vietnamese rice exporters must always be prepared for all possibilities and situations. The crucial factor is ensuring and maintaining the quality of rice across shipments. Furthermore, it's essential to maintain competitiveness and avoid unfair competition that leads to price undercutting. This would negatively impact not just one business, but many Vietnamese rice exporters.