Free Trade Zones

The EU remains a very potential importer of Vietnamese rice

VIETNAM, January 17 –

Visitors at the 5th Việt Nam Rice Festivals in the southern province of Vĩnh Long earlier this month. — Photo VNA/VNS Lê Thúy Hằng

HÀ NỘI — With stable and high demand for specialty rice from Asia, the European Union (EU) remains a high-potential market for rice exporters from Việt Nam, Đầu Tư (Việt Nam Investment Review).

In 2021, Việt Nam shipped around 60,000 tonnes of rice worth US$41 million to the EU, up nearly 1% in volume and more than 20% in value compared to the EU. ‘last year. This included some 40,000 tons of fragrant rice worth nearly $30 million, up more than 9% in volume and nearly 30% in value.

The EU-Việt Nam Free Trade Agreement (EVFTA), which entered into force on August 1, 2020, helped to raise Vietnamese grain prices by $10 – 20 per ton, partially offsetting the modest increase in volume due to the COVID-19 pandemic.

According to EU statistical office Eurostat, among the 10 largest rice suppliers to the bloc, rice from Việt Nam saw the highest price growth, 20.3%, to an average of $781 per tonne. .

The Foreign Trade Agency of the Ministry of Industry and Commerce of Việt Nam attributed these results to the companies’ capitalization of the advantages created by the EVFTA. In addition, they are also stepping up the production of high quality rice such as fragrant, long grain and specialty varieties to enter demanding markets.

For example, fragrant rice accounted for 70% of the country’s total rice exports to the EU, up from 64% the previous year.

With 27 Member States, a population of around 516 million and an annual GDP per capita of over $35,000, the EU has a strong demand for imported goods, particularly agricultural products (over $160 billion dollars per year), from all over the world.

For Việt Nam, the EU is its third largest importer of agricultural products, around 5.5 billion dollars per year. However, the Southeast Asian nation’s agricultural products account for only 4% of the bloc’s imports of such products. In particular, Vietnamese rice has a market share of just over 1 percent.

The Việt Nam Food Association predicts that rice exports to the EU will continue to grow well in 2022. In particular, the improvement in the quality of fragrant rice has met the demand from European consumers.

The optimization of EVFTA to export rice at zero tariffs is encouraged by companies with large material production areas such as Lộc Trời, Tân Long and Trung An.

Phạm Thái Bình, general manager of Trung An Hi-Tech Farming JSC, said EVFTA provides greater opportunities for Việt Nam’s agricultural products, including rice. The company had used the deal to sell thousands of tons of rice in markets including Switzerland, France and Germany.

Meanwhile, Lộc Trời was the first to export 126 tonnes of fragrant rice to the EU under the EVFTA, in September 2020. It currently accounts for almost 70% of Việt Nam’s rice exports to this bloc. . —VNS