Report Highlights:

Wheat import volume for MY 2015/2016 is forecast unchanged. The Vietnam MY2014/2015 rice export is revised up from 6.3 million tons to 6.5 million tons, due to unexpected demand from Vietnam traditional markets at the end of calendar year 2015. The MY 2015/2016 rice export is revised down from 7.1 million tons to 6.0 million tons, due to expected low carry-over stocks from the MY 2014/2015.

WHEAT

Wheat

2013/2014

2014/2015

2015/2016

Market Begin Year

May 2013

May 2014

May 2015

Vietnam

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

0

0

0

0

0

0

Beginning Stocks

265

265

373

373

294

368

Production

0

0

0

0

0

0

MY Imports

2158

2158

2296

2370

2600

2600

TY Imports

2158

2158

2296

2370

2600

2600

TY Imp. from U.S.

161

161

317

260

0

300

Total Supply

2423

2423

2669

2743

2894

2968

MY Exports

175

175

225

225

225

225

TY Exports

175

175

225

225

225

225

Feed and Residual

350

350

600

600

700

700

FSI Consumption

1525

1525

1550

1550

1575

1575

Total Consumption

1875

1875

2150

2150

2275

2275

Ending Stocks

373

373

294

368

394

468

Total Distribution

2423

2423

2669

2743

2894

2968

(1000 HA) ,(1000 MT)

PRODUCTION

Vietnam does not produce wheat.

CONSUMPTION

The MY 2014/2015 wheat consumption remained at 2.15 million tons.

The MY 2015/2016 wheat consumption is forecast to remain unchanged due to less demand for feed wheat for the feed industry, which is expecting more competitive price of corn compared to feed wheat.

TRADE / COMPETITION

Post revises Vietnam's wheat imports volume in the MY 2014/2015 slightly up from 2.296 million tons to 2.370 million tons, an increase of 74,000 tons compared to the Official number, due to the increase in the use of feed wheat. Imported volume for MY 2015/2016 is forecast unchanged at 2.60 million tons.

Australian milling wheat remains dominant in the wheat import market in Vietnam, its market share, however, shrank from over 70-80 percent of Vietnam's total wheat imported volume in MY 2013/2014 to around only 50 percent in MY 2015/2015. Canadian wheat and Brazilian wheat picked up shares from almost nothing in MY 2013/2014 to more than 300,000 tons from each source in MY2014/2015. The forecast for total import of wheat into Vietnam remains unchanged in the MY 2015/2016.

The growth of baked wheat-based products and noodles requires high quality wheat, which possibly favors increased consumption of U.S. wheat. U.S. wheat is also used by Vietnamese mills for blending as a cost-effective way to improve the quality of their flour products. The recent year-on-year volume of U.S. wheat exported to Vietnam keeps on increasing – explaining the increase demand of premium quality wheat. However, exports of U.S. wheat into Vietnam which previously was expected to be around 320,000 tons in MY 2014/2015 has to be revised down to around 260,000 tons due to strong price competition from other wheat sources, especially Canadian wheat. Post put the forecast for import of U.S. wheat in MY 2015/2016 at 300,000 tons.

RICE

Rice, Milled

2013/2014

2014/2015

2015/2016

Market Begin Year

Jan 2013

Jan 2014

Jan 2015

Vietnam

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

7788

7788

7692

7792

7660

7660

Beginning Stocks

863

863

999

999

1173

633

Milled Production

28161

28161

28074

28234

28200

28160

Rough Production

45058

45058

44918

45175

45120

45056

Milling Rate (.9999)

6250

6250

6250

6250

6250

6250

MY Imports

300

300

400

400

400

500

TY Imports

300

300

400

400

400

500

TY Imp. from U.S.

0

0

0

0

0

0

Total Supply

29324

29324

29473

29633

29773

29293

MY Exports

6325

6325

6300

6500

7100

6000

TY Exports

6325

6325

6300

6500

7100

6000

Consumption & Residual

22000

22000

22000

22500

22000

22600

Ending Stocks

999

999

1173

633

673

693

Total Distribution

29324

29324

29473

29633

29773

29293

(1000 HA) ,(1000 MT)

PRODUCTION

Vietnam's Area, Yield, and Production for Rough Rice (as of August 2015)

Marketing Year

2013/2014

Revised

2014/2015

Estimate

2015/2016

Forecast

Harvested Area (tha)

Old

New

Old

New

Old

New

Winter1

1,770

1,770

1,700

1,800

1,680

1,680

Spring2

3,111

3,111

3,112

3,112

3,100

3,100

Autumn3

2,907

2,907

2,880

2,880

2,880

2,880

TOTAL

7,788

7,788

7,692

7,792

7,660

7,660

Yield (mt/ha)

Winter

4.75

4.75

4.80

4.80

4.85

4.85

Spring

6.67

6.67

6.65

6.65

6.75

6.75

Autumn

5.47

5.47

5.58

5.50

5.55

5.55

AVERAGE

5.79

5.79

5.84

5.80

5.88

5.88

Production (tmt)

Winter

8,407

8,407

8,160

8,640

8,148

8,148

Spring

20,750

20,750

20,695

20,695

20,925

20,925

Autumn

15,901

15,901

16,064

15,840

15,983

15,983

TOTAL

45,058

45,058

44,919

45,175

45,056

45,056

1 Lua Mua (10th Month), 2 Winter-Spring, 3 Summer-Autumn

Source: MARD, Post estimates

Revised estimate for MY 2014/2015 Vietnam rice production (began January 2015)

Post revises total rice production for MY 2014/2015 to reach 45.18 million tons of paddy rice, or approximately 28.24 million tons of milled rice equivalent. A slight increase compared to MY 2013/2014 production (about 100,000 tons of paddy). The increase in production is mainly due to the larger planted and harvested area of winter crop, due to low level flooding in the Mekong River Delta (MRD).

Autumn Crop

The autumn crop is mainly located in the southern provinces. Especially, the MRD typically accounts for more than 80 percent of the total autumn crop planting area. As of December 15, 2015, the harvest of the MY 2014/2015 autumn crop is nearly completed, due to decreased water supply caused by lower flooding water level. For crop in some planted areas, yield is expected down (from 5.58 tons per hectare to 5.5 tons per hectare) resulting in lower production (from expected 16.06 million tons to 15.84 million tons).

Winter Crop

Also due to the lower flooding water level, farmers were able to expand their areas for winter crop, the latest crop of the year. Post revised the harvested area for winter crop from 1.7 million hectares to 1.8 million hectares. The MY 2014/2015 winter crop production, therefore, was revised up from 8.16 million tons to 8.64 million tons.

CONSUMPTION

Post estimates that the country needs to consume each year an additional amount between 100,000 tons to 500,000 tons for rice to remain the dominant staple food and for the country to supply the food processing and animal feed industries.

In recent year Vietnam has exported rice to neighbor countries, mainly China, via border trade. However, the trade volumes have not been recorded in the official numbers of both selling and buying countries. Post therefore cannot include the number of such trade volumes into the export numbers and has to consider these volumes as a part of local consumption. Post's local consumption, is eventually higher than the actual local consumption.

STOCK

Rice stock in MY 2014/2015 is estimated to be very low due to unexpected increase in demand from Indonesia and the Philippines. Rice stock in MY 2015/2016, however, is expected to be at an identical low level compared to MY 2014/2015, which will prevent Vietnam exporting large amounts in MY 2015/2016.

TRADE / COMPETITION

Exports

The Vietnam MY2014/2015 rice export is revised up from 6.3 million tons to 6.5 million tons, due to unexpected demand from Indonesia and the Philippines at the end of calendar year 2015. The MY 2015/2016 rice export is revised down from 7.1 million tons to 6.0 million tons, due to expected low carry-over stocks from the MY 2014/2015.

Imports

Post estimates MY 2014/2015 and MY 2015/2016 rice imports from Cambodia remained 400,000 tons and 500,000 tons, respectively, given Vietnam's thin carry-over stock from MY 2013/2014 to MY 2014/2015.