In January 2024, Vietnamese rice exporters won a tender to supply over 300,000 tons to Indonesia.

According to the Vietnam Trade Office in Indonesia (Ministry of Industry and Trade), the Indonesian government has decided to increase the rice import quota for 2024 by 1.6 million tons.

This decision was made due to a shortage in domestic rice production in Indonesia, which has been affected by the El Niño phenomenon in 2023, causing delays in the main cropping season.

As a result, the main rice harvest is expected to occur in May and June, rather than in March and April as usual.

With the additional 1.6 million tons of imported rice, the total quota for rice imports set by the Indonesian government for 2024 will be 3.6 million tons.

So far, the Indonesian Ministry of Trade has issued import licenses for 2 million tons of rice. The additional import licenses for 1.6 million tons will be issued soon after completing some related administrative procedures.

Additionally, the Vietnam Trade Office in Indonesia has reported that rice prices in Indonesia have recently surged due to severe shortages.

As of February, Indonesia has experienced eight consecutive months of rice deficits due to insufficient domestic production relative to demand.

Rice shortages have begun to appear in supermarkets. The Indonesian Ministry of Trade has urged people to switch to government-subsidized rice to avoid excessively high prices in the free market.

Retail rice prices in Indonesia are 80,000 Rp (approximately $5.17) per 5kg, compared to the government’s capped price of 69,500 Rp ($4.45) per 5kg.

According to data from the Indonesian Statistics Agency, in January, the country imported 441,930 tons of rice, an increase of 82.19% compared to the same period last year, with a value of $279.2 million.

Among the top rice suppliers to Indonesia are Thailand with 237,640 tons, followed by Pakistan with 129,780 tons, Myanmar with 41,610 tons, Vietnam with 32,340 tons, and Cambodia with 2,500 tons.

The Vietnam Trade Office in Indonesia notes that the severe rice shortage is occurring before the main harvest and coincides with Ramadan, which starts in mid-March and lasts for a month, likely increasing demand for food.

Therefore, in addition to the tender for 500,000 tons of rice on January 17th (in which Vietnamese rice exporters won a bid to supply over 300,000 tons), the Indonesian government is expected to soon open additional tenders for rice purchases.

Vietnamese rice exporters should closely monitor market information and seize the opportunity to export rice to Indonesia in the early months of the year.

In 2023, Indonesia became Vietnam’s second-largest rice importer, with a volume of over 1.1 million tons valued at over $640 million, representing a significant increase of 878% in quantity and 992% in value compared to 2022.

Source: Vietstock