Vietnam food firm ties up with Cambodian partner for EU export

Thursday ,Oct 08,2009

(Post by CAAI News Media)

The Southern Food Company (Vinafood 2) has set up a joint stock company with a Cambodian firm to process and export rice to the European Union to take advantage of the tax exemption the EU has offered to Cambodia from September 1.

In the first nine months Vietnam exported 4.975 million tons worth $2.2 billion

The EU has classified Cambodia in a list of the world’s 49 poorest countries and waived tariffs on its exports to block members.

The new joint stock company, Cavifoods, has a capital of US$17 million.

Last year Vinafood 2 set up Saigon Food (Pte.Ltd) in Singapore to capitalize on the advantages Singaporean firms in negotiations with companies around the world, especially in Africa.

The Vietnam Food Association also said that it is determined to keep rice export prices at not lower than $400 per ton. Since the beginning of the year foreign buyers have pressured Vietnamese companies to lower prices to up to $360.

Undercutting by Vietnamese exporters has helped the buyers as the exporters regularly negotiate with them to sell the grain at prices lower than regulated by the association.

At the beginning of this month foreign importers agreed to a price of $400.

In the first nine months Vietnam exported 4.975 million tons worth $2.2 billion.

It has signed deals to export 5.798 million tons this year, with high-quality rice making up 38 percent of this, a 78 percent increase over last year.

The major markets are Asia -- including the Middle East -- who account for 61.3 percent of the exports, followed by Africa with 27.7 percent.

By Cong Phien-Translated by Viet Trung