Rice exporters look to Africa for growth opportunities. Photo: Duc Thanh

Vietnam's rice industry is facing one of its toughest challenges in years as two major markets, the Philippines and Indonesia, have sharply cut imports, forcing exporters to scramble for alternative buyers. Many firms are now pivoting to Africa, where demand for Vietnamese rice is unexpectedly rising.

For years, the Philippines and Indonesia accounted for nearly half of Vietnam's rice exports, serving as vital pillars of the trade. That stability was upended in September when the Philippines, Vietnam's largest buyer, suddenly suspended rice imports for 60 days and signalled the pause could extend through the year. Customs data shows Vietnamese rice shipments to the Philippines in September plummeted by 93.3 per cent in volume and 92.6 per cent in value compared with August.

Indonesia, the second-largest importer, simultaneously tightened its import quotas, causing widespread contract delays and cancellations. As a result, Vietnam's overall rice exports in September dropped to just 466,800 tonnes, worth $232.38 million, down nearly 47 per cent on-month. Around 500,000 tonnes of rice remains stuck at ports, leaving exporters in limbo.

Nguyen Van Don, director of Viet Hung Co., described the fallout. "With the Philippines suspending imports, domestic prices have fallen sharply. Contracts were signed, but partners have postponed, freezing capital while storage and transport costs soar," he said. The cash crunch has worsened as VAT refunds remain delayed, further squeezing liquidity.

The sharp decline has pushed Vietnam's export prices downward, prompting the Vietnam Food Association (VFA) to urge firms to avoid panic selling. Instead, companies have been encouraged to diversify their markets and strengthen resilience.

One key direction is Africa. Despite higher shipping costs and more complex payment terms, countries such as Ghana, Ivory Coast, Nigeria, and Senegal are significantly increasing their Vietnamese rice imports. According to the VFA, Ghana imported 662,000 tonnes in the first eight months of 2025, worth $373 million, up 95 per cent in volume from the same period last year. Ivory Coast imported 754,000 tonnes, worth $349 million, up 156 per cent in volume.

“Unlike Southeast Asia, African markets present fewer policy risks, although they require government-to-government contracts, stronger capital, and logistics capabilities,” said Phan Van Co, marketing director of Vrice. “This is not for short-term players but for companies with long-term strategies.”

In parallel, exporters are repositioning toward high-value segments such as fragrant, speciality, and organic rice. Varieties are finding stable markets in Japan, the EU, and South Korea," Co added. “Once premium products enter international supermarket chains, price pressures ease considerably.”

VFA chairman Do Ha Nam stressed that the crisis underscores the risks of overreliance on a few markets. While there is no official extension yet of the Philippines' ban, he warned exporters to take the episode as a clear signal for change. He urged the government to accelerate VAT refunds, ease credit access, and strengthen trade promotions in Africa and the Middle East.

“This is a true stress test for Vietnam's rice sector,” Nam said. “We cannot rely on luck or the policies of others. Now is the time to build strength from within, with quality, supply chains, and national branding.”