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Rocketing fertiliser prices threaten rice production
24 | 10 | 2007
The skyrocketing fertiliser prices in the world’s and domestic markets have been making farmers weep while threatening rice production in Vietnam.

In the world’s market, the fertiliser price has hit the highest peak in the last 50 years. In the domestic market, the price has increased two times since early September. Fertiliser products have become VND20-50,000/bag more expensive compared to the previous month. The price of Phu My-sourced urea has increased by VND15-25,000/bag, while China-sourced DAP by VND10-40,000/bag.

The above said prices are the levels of inventory products. In fact, the newly imported products are much more expensive. Binh Dien’s NPK is now selling at VND350-360,000/bag

Analysts say that there are no signs of price decreases for the upcoming winter-spring crop. It is very difficult to curb the price increases while Vietnam still relies on imports.

In fact, most farmers still have to purchase fertiliser products at prices higher than the producers’ announced prices. They cannot buy products directly from producers or sale agents, but from speculators. In some cases, they have to purchase on credit, and have to pay interest for the purchasing deals.

Prof Dr Vo Tong Xuan, a senior agriculture expert, said that it was necessary now to change the cultivation habits of farmers. 50% of farmers in the Mekong River Delta always put down too much fertiliser, which may push up the rice production cost, while raising the possibility of insect infection, and badly affecting the rice yield.

According to Mr Xuan, a member of the International Fertiliser Development Centre (IFDC)’s Directorial Board, as the kerosene price has increased by three times compared to the previous year’s level, some big fertiliser producers have to cut productivity, lower supply, which has certainly led to the skyrocketing fertiliser prices.

Mr Nguyen Tri Khiem, Dean of Economics Department under the An Giang University, said that while fertiliser and other material prices keep increasing, farmers cannot define the selling prices of their rice products. Farmers will be the biggest sufferers.

According to Mr Khiem, agricultural material prices have increased by two fold, and the prices of the products serving farmers’ lives have increased by 5-6 times compared to rice prices.

Prof Vo Tong Xuan:

If Vietnam does not have effective measures to optimise profit, Vietnam’s rice will face big risks. Recently, many African countries have begun to grow paddy themselves, striving for self-sufficiency. Meanwhile, if Myanmar successfully renovates its policies, the country will be a rival of with many advantages over Thailand and Vietnam in the competition in terms of both quality and production cost.


Vietnam Economic Times
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