Vietnam has emerged as the world’s second largest rice exporter in the past two
decades after being a starving nation in 1980s. The emergence of Vietnam has major
implications for the world rice market and for Vietnam itself. Data limitations have,
until now, limited research on the role of Vietnam’s rice economy in the global
market. This study estimates a simple annual export rice model for Vietnam to explain
and evaluate the changes in rice consumption, production and exports. Combined with
an aggregate estimate of rest-of-world supply and demand and a price linkage
equation, we are able to formulate a simulation model to investigate the impact of
alternative scenarios on Vietnam and World production, consumption and world
prices. Key findings include price elasticities of demand and supply for Vietnam as
well as demand elacticities for rest-of-world price and income. Simulations show a 10
% increase in per capita Vietnam income growth causes only a slight increase in
domestic consumption with a 6 % decrease in exports and a 0.6% increase in prices.
However, a 3.6 % increase in world income leads to a 2 % increase in world rice
prices (a 2% increase in Vietnam rice prices) and an increase of 8.1 % in exports.
Simulations show that a slowing of improvements in rice production technology from
5% annual increase to a 2.5% increase leads to a 5 percent decrease in Vietnam
production, a 21 % decrease in exports and a 9% increase in world prices.

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