VN stockpiles rice to ensure profits for farmers
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Vietnamese enterprises began purchasing 1 million tonnes of rice for stockpile in the Mekong Delta from Saturday under a government programme that aims to ensure farmers make a profit.
The purchase, carried out at the time when the farmers in the nation’s biggest granary have harvested their summer-autumn rice, will last until the end of next month.
The programme for the harvest season is a month ahead of previous harvests.
The government has covered 100 per cent of interest rates on loans for a three-month term for businesses buying rice. Assigned by the Viet Nam Food Association, 115 eligible enterprises have joined the programme with a targeted amount in each province. For example: Long An province 91,000 tonnes, Kien Giang 85,000 tonnes and Bac Lieu and Hau Giang 10,000-15,000 tonnes.
According to leaders of Vinh Hung District of Long An province, farmers have been waiting for enterprises.
The price fixed by the Ministry of Finance averages at 4,142 Vietnamese dong per 1kg of unhusked rice.
According to the association, with such a low price, plus difficulties in export markets, the programme could only guarantee a low profit for farmers, less than the 30 per cent expected by the government.
Head of the sales department of the Dong Thap Food Company, Dang Van Khuong, told the Voice of Viet Nam (VOV) that a 30 per cent profit could only be gained if the unhusked rice was sold at 5,400 dong.
He also said his company would only buy rice under the market price.
Minister of Agriculture and Rural Development Cao Duc Phat had also admitted it was a problem, but it could not be settled during the economic downturn.
Other support policies would be worked out to help both businesses and farmers, he said. For example, a special preferential credit programme would be provided to farmers so they would stockpile their products.
But in the long run, he said, there must be stable contracts signed between the two sides to ensure an outlet for farm produce, particularly rice.
