Many Vietnamese rice exporters are facing difficulties after China authorised only 22 Vietnamese businesses to export rice into the country.
The permission was announced by China’s General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ), which allowed 22 firms to export rice and rice products from January 1, counting from the date of departure from the Vietnamese border. Any businesses not listed by AQSIQ were banned from exporting to the Chinese market from January 1.
This decision has affected many Vietnamese firms which were not in the list but had already signed rice contracts before the date.
One such company is Can Tho Food Company, which had signed a contract to export 18,000 tonnes of rice to China at the end of last year.
Nguyen Van Dung, the company’s deputy director, said the delivery would have been completed by early February, but following the new order, it was no longer permitted to export and hence was suffering huge losses.
“Our contract was cancelled and we have to compensate some VND300 billion for our partner. In addition, we have to bear further costs,” Dung told Vietnam Television.
Dung said rice was preserved in the store for quite a long time so the company had to re-process 10,000 tonnes of rice, which raised the cost by VND200-300 per kg.
“I hope the State and relevant sectors create conditions for my company to sell rice, helping us to overcome difficulties. If it is not solved soon, my company will go bankrupt,” Dung said.
Tran Thanh Nam, deputy minister of agriculture and rural development (MARD), said the ministry would soon contact China authorities, asking them to send an expert delegation to Viet Nam to assess more businesses which could be eligible for exporting rice to China.
China’s permission to 22 Vietnamese rice exporters was given after a group of Chinese experts travelled to Viet Nam to inspect 31 enterprises that had previously applied to the local ministry for export rights to China last year.
According to MARD, China tops the list of Viet Nam’s rice export with 35.4 per cent of market share in the first three quarters of 2016.
Total rice export turnover to the Chinese market touched 1.35 million tonnes, amounting to $613.4 million in 2016, down 23 per cent in terms of quantity and 13.9 per cent in terms of value in comparison with the same period in 2015.