Mr. Truong Sy Ba, Chairman of the Board of Directors and CEO of Tan Long Group (TLG), stated that in the history of Bulog’s rice tenders, from 2023 until now, Tan Long has only won a single lot of 30,000 tons of rice through Posco (South Korea)
Domestic rice traders are abuzz with the news from Indonesian media outlet VOI on July 4, reporting on allegations against the National Food Agency (Bapanas) and the Public Logistics Agency (Perum Bulog) for inflating prices, increasing import prices, and holding rice stocks at Tanjung Priok Port.
Mr. Mokhamad Suyamto, Director of Supply Chain and Public Services at Perum Bulog, stated that the allegations of price increases surfaced when a Vietnamese company, Tan Long Group, offered 100,000 tons of rice at a price of USD 538 per ton on an FOB basis.
“Tan Long Vietnam is said to have offered rice but has not actually made any offers since the bidding opened in 2024. Therefore, there are no obligations regarding import contracts with us this year,” Mr. Suyamto was quoted as saying.
Mr. Suyamto also stated that Perum Bulog has been tasked by the Ministry of Trade to import 3.6 million tons of rice in 2024. From January to May 2024, imports reached 2.2 million tons.
Regarding this information, Mr. Truong Sy Ba, Chairman of the Board of Directors and CEO of Tan Long Group (TLG), stated: “In the history of Bulog’s rice tenders, and from 2023 until now, we have only won a single lot of 30,000 tons of rice through Posco (South Korea), and we have not won any lots directly from Bulog.”
“TLG won this 30,000-ton lot at a price of USD 620 per ton. The bidding took place around January (before Tet), with delivery from February 25 to March 15. However, due to a request from Bulog to postpone the schedule, the actual delivery was made in April due to port congestion in Indonesia, which caused delays in unloading the goods. After completing the delivery, this lot turned out to be profitable for Tan Long,” said Mr. Ba.
The Chairman of Tan Long Group further informed that Bulog has not opened any new tenders for rice purchases in June, partly because they are expecting lower rice prices during the summer-autumn crop in the Mekong Delta and partly due to port congestion, which has resulted in additional penalties for delayed shipments from April and May.
Regarding the tender on May 22, in which Loc Troi and its member company won the bid for 100,000 tons of rice, Mr. Ba stated that Tan Long’s bid was USD 15 per ton higher, which is why they did not win.
“On May 19, Mr. Andi Amran Sulaiman, Indonesia’s Minister of Agriculture, visited Vietnam and subsequently toured Tan Long’s rice mill in Can Tho and the Hanh Phuc rice mill in An Giang. We offered to sell 100 tons of rice at USD 538 per ton, FOB price. However, when compared to Loc Troi’s price, ours was considered higher, so we did not win.”
“Currently, the market price for rice to Indonesia is around USD 525 per ton. If we had sold at that time, we would have made a profit of USD 13 per ton… But since Indonesia purchases rice through Bulog’s tenders and buys CNF price instead of FOB, and the CNF price that Loc Troi, Thuan Minh, and Quang Phat won was around USD 568 per ton, which translates to an FOB price of approximately USD 530 per ton, lower than our offered price of USD 538 per ton, FOB price. Our offer was USD 5-8 per ton higher,” Mr. Ba informed.
According to Mr. Ba, the prices offered by the winning companies in that tender are still profitable for them. Moreover, he emphasized that if Vietnam had not won those tenders, the domestic rice prices would have plummeted uncontrollably, and it is only because of these contracts that the market now has buying power.
From the beginning of the year until June 25, 2024, Vietnam has cleared customs for 4.383 million tons of rice, a 6.53% increase compared to the same period last year. The main export markets include the Philippines with 1.915 million tons, Indonesia with 698,000 tons, Africa with 484,000 tons, and Malaysia with 434,000 tons, among others.
If we include the recently won tender (including deliveries that have not yet been made), from the beginning of the year until now, the total volume of Vietnamese rice that has won the Bulog tenders is approximately 800,000 tons.
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Vietnam loses its position as the world’s highest rice price
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Sharp decline in rice prices, businesses secure big profits
The price of rice in the domestic market is currently experiencing a downward trend, starting from the 6th day of the Lunar New Year (15th of February) until now, the price of rice has decreased by 1,000 VND/kg, equivalent to 2,000 VND/kg of rice. The sharp decrease in rice prices has caused traders to incur losses, while businesses that had signed rice selling contracts before the New Year have all made profits.
Serious Rice Shortage in Indonesia
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