A Trade Ministry spokesman said the country looked set to export 1.25 million tonnes of rice in the three months to June, leading to an eight percent fall in rice sales earnings of 225 million dollars.

"The main reason is that we exported too much in 2003 so the reserve for 2004 is pretty small," the spokesman said.

"At the same time, the production in the first three months of this year was affected by severe draught."

He said Vietnam now expects to export 3.5 million tonnes of rice this year, a decrease of 11.2 percent compared with 2003.

On Tuesday, the ministry also warned its farmers and rice exporters about the drop of prices on the world market, as many Vietnamese exporters keep their rice to wait for higher prices.

Vietnam exported 808,000 tonnes of rice in the first three months of this year, an increase of 6.1 percent compared with the last year.

Rice is Vietnam's top agricultural export earner. Last year, the country exported nearly 3.9 tonnes of rice. Southeast Asia accounts for 34 percent of Vietnam's rice exports, with Indonesia and Philippines being the two biggest importers.

TERRA.WIRE