Rice businesses suggest lifting export quota, ironing snags

Several local rice exporting firms have called for the removal of hurdles, including quotas, as large numbers of containers are now getting stuck at ports due to the long wait to receive customs clearance.

Many rice businesses will meet difficulties if their export contracts are put on hold

During a meeting held in Ho Chi Minh City on April 22, a number of enterprises complained about the customs declaration system losing their data which led to difficulties in exporting their goods.

“We completed the customs declaration form at 1:51 on April 11, but later on the data could not be found in the system,” said a representative of Binh Dinh Food company.

According to the representative, up to 9,700 tonnes of rice was unable to be unloaded following the containership docking at My Thoi port on the same day. Combined with the amount of rice stored at the port, the company’s total loss is estimated to be over VND100 billion.

Elsewhere, Nguyen Quang Hoa, director of Duong Vu Co. Ltd. of Long An province, expressed his desire for the firm’s 500 rice containers to be cleared as soon as possible due to container storage costing VND350 million each day, excluding ship rental services.

In responding to these issues, the Vietnam Food Association (VFA) cited preliminary reports, stating that nine businesses had completed customs declarations, but were unable to trace their data in the system.

Addressing the problem, Deputy Minister of Trade and Industry Tran Quoc Khanh proposed that the General Department of Customs move to examine and deal with enterprises that had lost data as of April 22 in a bid to minimise their losses.

Priority should be placed on clearing shipments that are already stuck at ports, with the large quantity of rice in storage following shortly afterwards, Deputy Minister Khanh suggested.

In response, Mai Xuan Thanh deputy director of the General Department of Customs, stated he had requested that relevant agencies examine and re-correct data within their system.

“We are under constant pressure, because the amount of rice for export signed in contracts by businesses and their partners totals 1.3 million tonnes, while the government has imposed a quota of only 400,000 tonnes,” he said, adding that the department will make proposals aimed at solving the problem in May.

Export quota to be lifted?

Amid these issues, VFA chairman Nguyen Ngoc Nam has proposed resuming normal rice exports during May, noting that the current situation relating to the novel coronavirus epidemic is different from the one that faced the country in late March when the General Department of Customs requested rice exports to be halted.

In addition, India’s recent decision to export rice once again has caused the global market price of rice to gradually decline. Opening the door for a return to normal rice exports would help local firms seize a “golden chance” whilst the market price remains high, he said.

Rice packages pile up at the storage facility of a rice business in Tien GiangPham Thai Binh, director of Trung An high-tech agriculture company, noted that the imposition of rice quotas has caused plenty of challenges for businesses involved in rice exports, therefore this mechanism should be swiftly abolished.  

Sharing the view, Le Minh Duc, director of Long An province’s Industry and Trade Department, added that the quota is no longer necessary due to an abundant supply of rice on the market, while national food security is also ensured.

Acknowledging proposals made by businesses and localities, Deputy Minister Khanh said the matter of national food security should be reviewed in the wake of the recent big winter-spring bumper rice harvest.

The Deputy Minister also admitted shortcomings occurring in management, but asked for sympathy from firms, adding that relevant agencies will compile solutions to iron out snags for businesses before submitting them to the Prime Minister.