Vietnam rice exports stable despite Indonesian chaos

Vietnam rice exports stable despite Indonesian chaos

HANOI (Reuters): Vietnam's rice exports have not been affected by turmoil in Indonesia as most directly-signed contracts between dealers in the two countries were delivered by March, traders said yesterday.

But some rice continued to be shipped through intermediaries, they added.

"Vietnamese exporters are not worried about payments from selling rice to Indonesia as most contracts were concluded through intermediaries who carried the risk with Indonesian buyers," one dealer in Ho Chi Minh City said.

Figures for Vietnamese rice sold to Indonesia through intermediaries were not immediately available.

The dealer said direct contracts between dealers in Vietnam and Indonesia totaling 225,000 tons of rice had been signed since the beginning of the year but Vietnamese exporters had defaulted on 105,000 tons of that amount.

The defaults came when rice prices soared from the third week of April due to worries about a prolonged drought and a government ban on new export contracts amid food security fears.

"There were some problems with letters of credit openings from the Indonesian side and Vietnamese dealers took the opportunity to default on their shipments when prices rose," the dealer said.

Hanoi stopped the signing of new rice export contracts from mid-April, and the ban remains in place.

Traders said last Thursday that indicative quotations for five percent broken Vietnamese rice would be $310-315 a ton, FOB Saigon Port, up from $275 a ton a month ago. Ten percent broken increased to between $305-310 last week from $270 per ton on April 19, they said.

Thai exporters have suspended rice and sugar exports to Indonesia unless the sales are backed by letters of credit from third countries, Thai industry sources said on Monday.

More than 500 people have been killed and thousands of shops, homes and offices in Jakarta have been destroyed in Indonesia's worst unrest in decades.