Hanoi, Nov 19 - Vietnam has signed a contract to export 100,000 tonnes of rice to Malaysia with shipment now under way, traders said on Wednesday, a significant deal after weeks of slow trade due to thin demand and low prices.
The contract with Malaysia is part of an unusually large volume of 1.5 million tonnes up for sale by Vietnamese exporters, part of an effort to boost domestic prices as farmers start producing their winter-spring crop, the largest of the season.
Ho Chi Minh City-based unlisted Vinafood 2, Vietnam's largest rice exporter, sold the 5 percent broken grain at $460 a tonne cost and freight for loading between now and December, said a Vietnamese trader whose company is contributing to the shipment.
A Vinafood 2 trader confirmed the deal but declined to provide the contracted price.
Vinafood 2 paid its affiliates $420 for each tonne of rice they contributed to the shipment, traders said.
"There are no large stocks of 5 percent broken rice at this time of the year so the contract with Malaysia has boosted prices," a trader with a foreign company said.
Vietnam's 5 percent broken rice price rose to $395-$400 a tonne this week, free-on-board, from $380 last week, while the low-quality 25 percent broken grain stood at $310-$315 a tonne, down from $360-$380 a tonne last Wednesday.
Traders blamed the price fall on large stockpiles of 25 percent broken rice held by farmers while demand was thin.
Farmers have started planting the winter-spring rice crop in the Mekong Delta rice basket and the harvest is expected from late February or early March at the earliest.
The crop is the highest yielding among Vietnam's three crops a year and most of the grain is destined for export.
Vietnam is expected to export 4.5 million tonnes of rice next year, the Industry and Trade Ministry has said, slightly lower than a government forecast of up to 4.7 million tonnes this year.