Vinafood 1 and Vinafood 2, which account for a combined 61% of Vietnam's rice exports, plan a storage facility in the Philippines to hold 1.7 million tonnes, the Liberation Saigon daily said.

The government aimed to export 5 million tonnes of rice this year, the newspaper said, an apparent revision that set the target at the top of a range of 4.5 million-5 million tonnes previously projected by the Agriculture Ministry.

First overseas facilities

If approved, the bonded warehouse, Vietnam's first such grain facility overseas, could hold nearly all the rice imported by the Philippines, which plans to import 1.8 million tonnes this year after 2.3 million tonnes last year.

"Not for me to speculate, but anyone who wants to invest in agricultural infrastructure post-harvest storage systems is welcome," Philippine Agriculture Secretary Arthur C. Yap said in a mobile "text" message, adding that he was not aware of any such plans by Vietnam.

Early this year, the Philippines, the world's largest rice importer, struck a deal to buy 1.5 million tonnes from Vietnam, the No.2 exporter after Thailand.

Assuring food security

The two state-run exporters made the proposal to prime minister Nguyen Tan Dung in a meeting last Wednesday, along with measures to boost exports and stabilise domestic prices before the main harvest.

"Given the situation that food is a global issue, we have to bring into full play the efficiency of rice production to ensure national food security, improving the income and lives of farmers," Dung was quoted as saying at the meeting.

HCM City-based Vinafood 2 said it exported 2.2 million tonnes of rice last year, accounting for 47% of Vietnam's total rice shipment.

Reuters - March 7, 2009