For more than 15 years, the United
States has enjoyed a robust market
share in Latin America. A
logistics advantage, strong contract
performances and the ability to
promptly ship specific quantities (including
rough rice) enabled the United States
to be the logical supplier for Latin
America. However, more recently, the
United States is losing ground in Latin
America as rice from other origins enters
the market at competitive prices.
More than 60 percent of all U.S. rice
exports are shipped to the Western
Hemisphere, totaling nearly $1.2 billion.
Ten of the top 15 export markets are located
in the Western Hemisphere, a vital
region for U.S. rice in which the USA Rice
Federation has been conducting promotions
and trade servicing for 15 years.
Vietnam Threatens U.S. Rice Exports
But Asian imports are becoming a real
threat to U.S. rice exports in the region and
recently in Mexico, our No. 1 export market.
Pakistan exported over 2,000 MT of
rice to Mexico in the first two months of
2013 (more than in 2012), and there are
rumors that 20,000 MT of rice from
Pakistan has been contracted. While
Pakistani rice exports to Mexico this year
represent less than 10 percent of Mexico’s
milled rice imports, it underscores that
Pakistan could become a competitive
player in Mexico, which is concerning,
although the larger threat is Vietnam.
Vietnam is the second-largest global
rice exporter and produces nearly five
times more rice than Pakistan. They conduct
aggressive marketing campaigns and
sell substantial amounts of rice in the
Caribbean, including about 400,000 MT to
Cuba. In bilateral talks in December 2012,
Haiti and Vietnam developed a strategic
investment partnership focusing on food
security, agriculture and other mutual
interests. Those talks produced an agreement
allowing for the purchase of 300,000 MT of milled long-grain rice from
Vietnam, with a shipment of 15,000 MT
arriving in Port-au-Prince last month. This
has serious, likely negative, implications
for U.S. exports to Haiti, which last year
was the second-largest export market.
Three-Point Proactive Approach
There are three things the U.S. rice
industry can do to combat this new world.
First, U.S. rice must build upon its image
abroad as high-quality, reliable and safe,
and this must be highlighted in effective
promotions. Pakistani and Vietnamese
imports don’t currently threaten that
image, but the Vietnamese government is
beginning to focus on quality.
Many Vietnamese farmers began planting
high-quality rice this year in the hopes
of corresponding high prices, but prices
are slightly lower than last year. If the
Vietnamese government develops a longterm
rice stockpiling policy that rewards
farmers for planting high-quality rice, then
the U.S. market share and image will be
Secondly, the U.S. must ensure a level
playing field so that government regulations
are equal and fair for all. If inconsistencies
are found, substantiated allegations
must be raised to the appropriate level.
Finally, the rice industry must accept and
adapt to this new world, acknowledging
that none of our export markets are guaranteed.
That doesn’t mean that we passively
watch market share decline, but instead
embark on an aggressive campaign to promote
our rice rather than criticize theirs.
USA Rice is adjusting its programs to
face this new reality. For example, we are
establishing partnerships with Mexican
millers and packers who sell 100 percent
U.S. rice to increase consumer recognition
of its value. USA Rice is committed to
tackling this growing threat by boosting
promotional efforts in key markets.
Please visit www.usarice.com.