ANI eyes JV with Vietnam rice supplier | Inquirer Business
Close  

ANI eyes JV with Vietnam rice supplier

/ 05:10 AM June 03, 2019

Agricultural trader Agrinurture Inc. (ANI) aims to be a major player in the country’s newly liberalized rice trading regime with a potential deal with the state-controlled Vietnam Southern Food Corp (Vinafood II) to bring in two million metric tons of Vietnamese rice to the Philippines a year.

This volume is valued at about $1 billion, out of which ANI can earn a profit margin of about 5 percent, ANI chair, president and CEO, Antonio Tiu said in a recent press chat during the celebration of the company’s 10th year of listing on the Philippine Stock Exchange.

ADVERTISEMENT

“There’s a joint venture in the offing,” Tiu said, saying Vinafood II had committed to supply ANI with two million MT of rice.

The joint venture also calls for the creation of bonded warehouses in the Philippines to store rice during Vietnam’s harvest season.

FEATURED STORIES

“So we’ll have inventory depot here in Manila without us paying them until we draw (from the stock) and there’s no burden to pay duty until we pull out,” Tiu said.

Vinafood II, one of the world’s largest rice exporters, has rice milling operations in the Mekong Delta, the rice bowl of Vietnam.

“In the Philippines, if it’s rice, it’s as good as cash, wherever you bring it. The question is just (that) can you get good supplier with good price and good quality? Since Vietnam has committed two million MT, it makes us a serious player in the industry,” he added.

Tiu estimated that the Philippines’ current shortfall was at least five million MT of rice as the nation consumes about 12 to 13 million MT a year versus about eight million MT in domestic annual production.

“If I bring in two million metric tons, that adds $1 billion (to ANI’s) topline,” Tiu said.
Tiu said the shipments would be coursed through secondary ports—such as Legazpi, Batangas, Cagayan de Oro and General Santos—because the major ports were usually clogged.

He said ANI was among the first companies to apply to import rice under the new liberalized regime. Over time, he said ANI would be able to figure out where best to set up rice warehouses.

Beyond its debut into rice trading, ANI intends to transform from an agricultural trader to a technology-driven agri financier/enabler. It is working on a $100-million fresh investment from a foreign partner—which may be in the form of convertible bonds or outright equity (via follow-on offering)—which will be earmarked for funding contract growers. Rural bank Agricultural Bank Philippines will be its conduit lender.

ADVERTISEMENT

The loans are intended to be disbursed in the form of tokens to create an ecosystem that can be scaled up.

Per hectare of rice, maximum lending will P50,000 to cover the purchase of hybrid seed, fertilizer and chemicals to produce high-quality rice. For banana, the plan is to lend to cooperatives with standing crops to boost yield from an average of 2,800 boxes to about 4,000 boxes per hectare.

Read Next
Don't miss out on the latest news and information.

Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.

TAGS: Business, rice
For feedback, complaints, or inquiries, contact us.


© Copyright 1997-2021 INQUIRER.net | All Rights Reserved

We use cookies to ensure you get the best experience on our website. By continuing, you are agreeing to our use of cookies. To find out more, please click this link.