Vietnam commits 1.5M tons of rice to the Philippines

Vietnam has committed to supply the Philippines with 1.5 million tons of rice this year to alleviate an expected rice shortage in the coming months, the agriculture department said Thursday.

The agreement, signed by Philippine Agriculture Secretary Arthur Yap and Vietnamese Trade Minister Yu Huy Hoang, binds Vietnam to supply rice to the Philippines in 2008 except in case of natural disasters or unforeseen harvest loss.

The agreement also committed to take "strict measures" against illegal rice trading between both countries, the statement said.

The Philippine agriculture department said the price for the Vietnamese rice will be determined through the public bidding system between suppliers.

To further forestall any rice shortage, the US Department of Agriculture will also increase its credit commodity program with the Philippines to $75 million, clearing the way for the importation of an additional 100,000 tons of US rice into the country, the statement added.

The commitments were made as part of the Philippine government's efforts to avoid a rice shortage due to rising domestic demand and tight inventories around the globe.