VN sees success in seizing HK rice market from Thailand
Vietnam has gained a substantial share of Hong Kong's rice market at the expense of Thailand, resulting from fierce competition over the past 10 years.
Back in 2004, Thailand controlled almost 90 per cent of that city’s rice market, by sending about 275,000 tonnes to Hong Kong.
But its market share plunged to about 45 per cent in 2013 and then slightly recovered to 48 per cent last year, according to Hong Kong’s Trade and Industry Department.
Vietnam’s rice sales in Hong Kong started from almost nothing – 0.3 per cent of the market in 2004 – but its share jumped to 42 per cent in 2013 before dropping slightly to 40 per cent last year.
"It will be very difficult for Thailand to regain 90 per cent," Fong Ngai, director of the Hong Kong Economic and Trade Office for Asean, said yesterday during an interview on NOW26 TV.
Thailand’s market share in the first month of this year was up to 65.1 per cent versus Vietnam’s 26.3 per cent and Cambodia’s 0.3 per cent. However, that might not be the trend for the whole year.
Vietnam made a very smart move. It started by selling to restaurants and caterers. Now it can sell to consumers.
"Before we saw only Thai rice on the shelves of supermarkets. Now we also see Vietnamese rice," Fong said.
Recently Cambodia also made a successfully market entry. In the near future, Myanmar and other Asean members will likely join the fray.
Hong Kong’s rice market – 320,000 tonnes last year – is dominated by fragrant rice, followed by white rice.
Chareon Charoen Laothamatas, president of the Thai Rice Exporters Association, is pessimistic about the market outlook: "We will not be able to recapture our 90-per-cent market share in Hong Kong, because of our higher price." Thai fragrant rice is quoted at about US$1,000 per tonne against Vietnam’s $500 and Cambodia’s $600.
Rice-subsidy schemes perpetuated by previous governments are to blame, Charoen claimed.
"The governments wanted higher prices and it led to a loss of our overseas market share," he said.
The previous governments did not recognise that the market price is very important, while on the quality front, Vietnam and other Asean rice exporters have quickly upgraded their products, he added.
The association forecasts Thai rice shipments abroad to reach about 10 million to 11 million tonnes this year compared with 11 million tonnes last year.
