Rice prices face upside risks from tariff, storms

Rice prices, which spiked across the board in January, could accelerate further in the coming months due to potential hikes in rice import tariffs and the threat of destructive typhoons, according to projections by both domestic and foreign banks.

- BY DERCO ROSAL

American financial giant Goldman Sachs Group Inc. is looking at a potential increase in benchmark rice prices in Vietnam as the main risk to the cost of imported rice.

Last month, authorities modified the rules, allowing import tariffs to rise to as much as 20 percent from the current 15 percent if the Vietnamese government decides to hike the base price of its produce.

"So far, the threshold has not been met, so the import tariff on rice remains at 15 percent. As such, the increase in rice prices has been comparatively contained so far," Goldman Sachs Economics Research wrote in a Feb. 5 commentary obtained by Manila Bulletin.