Coronavirus: Vietnam stockpiles rice as outbreak spreads and food security concerns grow

Traders believe the world has enough rice but transport disruptions due to India’s lockdown and Vietnam’s stockpiling could affect global supply

Prices could also rise if there is more demand, as Thailand is producing less rice due to a drought, says a Bangkok-based trader

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A worker carries a sack of rice inside a warehouse in Valenzuela, the Philippines. Photo: Bloomberg

Published: 10:00am, 28 Mar 2020Updated: 12:19pm, 28 Mar 2020

Vietnam said on Friday that it plans to stockpile rice and suspend new rice export contracts through the end of the month to ensure it can feed its 97 million population through the coronavirus crisis.

The country is the world’s third-largest exporter of rice, behind India and Thailand. In an update on its website, the Finance Ministry said Vietnam’s state reserves department planned to have 190,000 metric tonnes of rice in storage by June 15.

The move comes amid worldwide food security concerns as the virus threat spreads, with some governments contemplating restricting the flow of staple food out of their countries. In Russia, the vegetable oils union has called for a restriction on sunflower seed exports, and Kazakhstan has suspended exports of goods such as buckwheat, sugar, and sunflower oil until the middle of next month.

Reuters reported that Vietnam’s export ban would have a significant short-term effect on global rice supply.

“If Vietnam maintains the export ban, we will suddenly have about 10-15 per cent less available supply in the world market in the near term,” one European rice trader was quoted as saying. “Africa especially could face disruption from this.”

Concerns have been compounded by India, the top global rice exporter, entering a three-week lockdown that brought several logistics channels to a halt, disrupting food supply chains.

A farmer harvests rice by a paddy field outside Hanoi, Vietnam. Photo: Reuters