The latest forecasts made by the UN Food and Agriculture Organisation (FAO) show that Vietnam will exceed the US and India in rice exports this year.

Though the Trade Ministry had adjusted its rice export targets to 3.9mil tonnes for 2003, it is estimated that the country will export up to 4million tonnes, 0.8mil tonnes more than last year.

India is pegged to export 3.8mil tonnes and the US 3.7mil tonnes.

According to the US Department of Agriculture, India's 2002-2003 rice crops reaped total output of only 182.57mil tonnes, a reduction of 37.43mil tonnes compared to its yearly plan due to prolonged drought in some states. It is estimated that India will only be able to export 3.25mil tonnes of rice, falling 250,000 tonnes, owing to contracted supplies.

US rice export volume is predicted to increase 100,000 tonnes, reaching 2.9mil tonnes next year. The US Department of Agriculture has forecast Vietnam's rice export reaching up to 4mil tonnes in 2004, compared to 7.75mil tonnes from Thailand, the world leading rice exporter. This may be the highest export level for Vietnam since 1999.

Rice prices in Asia were relatively static last week. Rice traders said that prices for Vietnamese rice would continue to increase until the next harvest crop. Vietnam's 5% broken rice is offered at US$187-190/tonnes (Free on board price), $178-182/tonne for 15% broken rice and $167-$172/tonne for 25% broken rice.

Importers tend to return to purchase Thai rice as it has a stable source of supply, as well as low, stable prices, said a rice exporter.