Retail rice prices remain high in major cities despite a significant drop in paddy and export rice prices, according to the Vietnam Food Association. The association’s data shows paddy prices have fallen 40-50% year-on-year, while Vietnam’s 5% broken rice hit a nine-year low at $395 per ton on February 14.
Drop in Export Prices
Vietnam’s export rice prices have dropped sharply from the $663 per ton peak in November 2023. This decline places Vietnam’s prices lower than those of other top rice-exporting countries, such as India, Thailand, and Pakistan. However, the price cuts in export markets have not yet trickled down to domestic retail levels.
Retail Prices Hold Steady
In Ho Chi Minh City (HCMC), rice prices range from VND17,000 to VND24,000 per kilogram. In Hanoi, prices are slightly higher, between VND19,000 and VND30,000 per kilogram. Retailers have not adjusted prices because they are still selling old stock purchased at higher costs.
Hoang, a rice store owner in HCMC’s Go Vap District, confirmed that price reductions would only occur once old inventory clears. “Once new shipments come in at lower prices, retail prices will gradually drop,” he explained.
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Rising Operational Costs
Wholesalers, like Phan Thanh Trung in HCMC’s Tan Binh District, pointed out that additional costs—such as transportation, storage, and labor—have also kept prices from falling quickly. “Spoilage during storage is another reason retailers are keeping prices steady,” Trung added.
Supermarkets, which typically sign long-term contracts with suppliers, have also maintained their prices due to contractual obligations.
Decline in Global Demand
Vietnam’s rice export boom last year was driven by India’s temporary export ban, which lifted global demand. Vietnam exported a record 9 million tons of rice in 2024. However, India has since lifted the ban, leading to a global rice supply surge and price drops.
Indonesia, Vietnam’s second-largest rice importer, has drastically reduced its imports due to efforts to become self-sufficient in food production. In January 2025, Vietnam shipped only 651 tons of rice to Indonesia—a 98% decrease compared to the previous year.
The Philippines, another key market, has also cut rice imports due to abundant domestic stockpiles.
Global Rice Market Trends
The U.S. Department of Agriculture projects global rice production will hit a record 527.6 million tons in the 2024-25 season, driven by increased output in India and China. Global consumption is expected to reach 526.4 million tons, while exports could rise to 56.3 million tons.
The World Bank forecasts that rice prices may fall further in the first half of the year before stabilizing toward the end of 2025. This trend could pose challenges for Vietnam, one of the world’s top rice exporters.
Vietnam’s Production Adjustments
Amid the potential oversupply, Vietnam’s Ministry of Agriculture and Rural Development plans to reduce the rice production area to 7 million hectares—down 132,000 hectares from 2024. This move is expected to lower rice output by 357,000 tons to 43.14 million tons. Rice exports are projected to fall to 7.5 million tons, down from last year’s record.
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