SUMMARY

• Vietnam plans a significant reduction in rice exports, from 7.1 million tons to 4 million tons per annum by 2030.
• The country aims to boost exports of high-quality rice while adapting to environmental changes and ensuring domestic food security.
• Export diversification forms a key part of the strategy, aimed at reducing over-reliance on any single nation.

In a paradigm shift poised to reconfigure the global rice market, the Vietnamese government plans to slash its rice exports to a projected four million tons annually by 2030. This drastic curtailment, down from the 7.1 million tons recorded in the preceding year, finds its roots in the strategic government document published on May 26.

As the world's third largest rice exporter, trailing only India and Thailand, Vietnam is undertaking this measure with multiple objectives in sight. The primary aim is to enhance the export of high-quality rice, while simultaneously ensuring domestic food security, environmental preservation, and climate change adaptation.

Understandably, this reorientation of Vietnam's rice export strategy will trigger a contraction in export revenue to an estimated $2.62 billion per annum by 2030, a sharp decline from the $3.45 billion recorded in 2022. Climate change and its direct impacts on the country's rice farming landscape form the basis of this shift. The transformation is also influenced by a section of farmers pivoting to alternative crops and shrimp farming. However, this strategy is seen by some, particularly a Ho Chi Minh City-based rice trader, as overly ambitious.

In the agricultural sector, a trend has been observed, particularly in the Mekong Delta region, where farmers are repurposing parts of their fields to fruit farms, while others are turning towards shrimp farming due to increased salination triggered by climate change. Despite these diversifications, rice farming still remains the predominant occupation for the majority.

Vietnam aims to minimize its dependence on any particular country by diversifying its rice export markets. To illustrate, the Philippines has been Vietnam's largest rice customer, accounting for 45% of its rice exports in the previous year. This diversification strategy also falls in line with a promise made by Vietnamese Prime Minister Pham Minh Chinh to Philippines President Ferdinand Marcos Jr. that Vietnam is committed to supply rice to the Philippines for the long term at reasonable prices.

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