Vietnam hikes rice price; Philippine firms in market

HANOI (Reuters) – Private firms in the Philippines may be in the market seeking to buy up to 660,000 tonnes of Vietnamese rice, traders said, as the Vietnamese food authority raised minimum rice export prices by up to 4 percent.

The potential buyers from the Philippines, the world's largest rice buyer, were expected to come to Vietnam this week to look for between 640,000 and 660,000 tonnes of 25 percent broken rice, traders in Ho Chi Minh City said.

Vietnam has sufficient rice stocks to export between 6 million and 6.5 million tonnes this year, thanks to ample supply from the Mekong Delta, a state-run newspaper reported.

Vietnam's rice loading in the second quarter ending June is projected to rise to 1.8 million tonnes, after 1.75 million tonnes expected in the first three months, the Vietnam Food Association said in a report obtained by Reuters.

The food association said it had raised the floor price for 25 percent broken rice, the most common grade often bought by the Philippines, by 2 percent to $490 a tonne.

It also raised the floor for 5 percent broken rice by 4 percent to $520 a tonne, free on board.

The new floors are for shipments this month and in March, the association said.

The floors were raised after Vietnam devalued its currency by 8.5 percent against the dollar on Feb. 11, which has attracted more buyers, exporters said.

''The Philippines' demand may not be large enough to increase prices because private companies often buy small lots,'' a Vietnamese trader at a foreign firm said.

A small lot means a volume of 50,000 tonnes, he said, adding that prices could rise only if importers bought a combined 500,000 tonnes or more within a short period.

The Philippines will import less than 1 million tonnes of rice this year, mostly via the private sector, and is likely to start in the first quarter, the head of the state grains agency has said.

Rice prices in southern Vietnam have risen slightly this week, party due to loading demand for Indonesia, traders said.

Raw milled rice grade 2, used to make the 25 percent broken rice, rose to 7,600-7,650 dong (36.5-36.8 US cents) per kg this week in the Mekong Delta, from 7,350-7,450 dong last week.

Indonesia has bought 400,000 tonnes of 15 percent broken rice from Vietnam for shipment from next month after Thai exporters could not meet their loading requirements, traders said.

(Source: http://www.mb.com.ph/articles/306511/vietnam-hikes-rice-price-philippine-firms-market)