When the price of rice jumped to record highs in Vietnam last weekend, Ton Ngoc Luan was working all day in his rice paddies, unaware of the news.
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By the time he realized what was happening, it was too late. Government intervention was roiling the markets, and his local trader was refusing to buy his newly harvested crop. He was stuck with seven tonnes of unsold rice in his storage shed, waiting for his trader to decide on a fair price.
"We are just countryside folks - we don't understand anything about the price fluctuations," Mr. Luan said in an interview on his farm in southern Vietnam, surrounded by sacks of unsold rice.
While the price of rice has doubled in recent months, most farmers are benefiting very little - even in Vietnam, the world's second-biggest rice exporter.
Their revenue has increased, but so too have their input costs - especially fertilizer, closely linked to the price of energy. Fuel, required for pumping water to their rice paddies and transporting their harvest, is another fast-rising cost. Even the cost of labour is skyrocketing as farm workers insist on higher wages because of Vietnam's record-high inflation rate.
In interviews across Vietnam, rice farmers unanimously reported that their costs have nearly doubled since last year, leaving them without any increase in income, despite the surging rice prices in domestic and global markets.
"Every time the price of rice increases, the cost of fertilizer seems to rise by about the same amount," Mr. Luan said. "If the government can somehow stabilize the cost of fertilizer, we could actually increase our incomes."
The 38-year-old farmer expects no increase in his income this year, despite the panic buying and soaring prices of the past week. "Only the traders and the processing plants are profiting," he said.
Analysts agree with him. "The profits are not in the hands of the farmers," said Vo Tong Xuan, a rice economist and professor in Vietnam. "The profits are enjoyed by middlemen and speculators who hoard the rice to sell it at a higher price."
He worries that the Vietnamese government, bowing to pressure from urban consumers, will order a reduction in rice prices. This would impoverish many farmers, since their costs are still rising, he said.
Most of Vietnam's farmers are unable to benefit from the surge in global rice prices because the government is limiting rice exports this year in an effort to protect its domestic supply. The restrictions are "very unfair to farmers," Mr. Xuan said.
Those limits, in turn, are allowing speculators to exploit the situation. There is mounting evidence that the latest jump in rice prices was triggered by speculators who capitalized on fears that the export restrictions were a harbinger of future shortages in Vietnam.
Just down the road from Mr. Luan's farm, another farmer is washing bags of rice seeds in preparation for his next crop. "It's very hard work, and not very profitable," says the farmer, 36-year-old Tran Van Binh.
"Look at those empty fields over there," he says, pointing to former rice paddies that are now covered in grass. "Many people have left their fields barren because they can't afford the fertilizer and pesticides. The farmers aren't happy at all. Only the traders are making big profits. That's the way it always is."
