Rice
Rice
Price movements (monthly)
India
Quarterly Change
Year-on-year Change
Thailand
Quarterly Change
Year-on-year Change
Vietnam
Quarterly Change
Year-on-year Change
- Indian rice: Prices declined slightly this quarter, especially when compared to last quarter, falling by 1.3%, and reaching levels last seen in September 2022. India’s rice production is expected to reach record highs this year, on track to surpass China and become the world’s top producer. This has resulted in significant oversupply in domestic markets, with stocks nearing full capacity. Additionally, despite some increased prices from June to July due to improved export demand, these gains were swiftly lost in August. According to market participants, India is facing difficulties due to the ongoing trade situation with the US, as tariff rates reached 50% as of August 27. To add to this, the Philippines has imposed a trade ban on rice for two months as of September 1. The impact was slightly lessened due to exemptions for basmati rice. The increase of rice imports from Iran after they lifted the ban in early August did help offset some of the reduction in export demand.
- Thai rice: Export price fell significantly this quarter and has dropped closer to the price levels of its competitors after being significantly above them from May to July 2025. Market participants attribute the decline to a surplus in stocks following the rice harvest. Demand has also been lackluster due to prior uncompetitive prices and a loss of export demand from Indonesia and the Philippines during their rice ban.
- Vietnamese rice: Traded at $368.40/mt as of September 17, showing a slight downward movement over the quarter. According to market sources, rice prices were initially supported by a tightened supply met with steady demand before the imposition of the Philippines rice import ban on September 1. The loss of export demand from the ban has caused the price to drop.
Rice
Price drivers
↓ Energy Prices
The Brent crude oil average price decreased by 3.2% M-O-M in August to $67.18/barrel, representing a drop of 14.9% Y-O-Y.
Crude oil prices decreased throughout August, chiefly attributable to the impact of OPEC+ output hikes adding supply to the market. Furthermore, a M-O-M fall in imports by China lowered demand optimism, while more recent data showed US ending stocks beginning to climb. However, sources continue to monitor conflicts between Russia and Ukraine, and Israel and Palestine, for the possibility of supply disruption.
↓ Global rice stock-to-use ratio
The resulting stock-to-use ratio for rice in 2024/25 is expected at 35.0% by the USDA, which is a slight increase from the year prior. A lower ratio suggests a tighter supply situation, triggering an increase in price spikes and enhancing volatility and vice versa.
USDA forecast for 2025/26 shows a 1.5% Y-O-Y increase in global demand, while ending stocks decrease marginally, resulting in the stock-to-use ratio decreasing back to 2023/24 levels.
↓ Freight rates
The shipping 40ft container composite decreased by 12% M-O-M and 56% Y-O-Y to $2,340 per unit in August. The decline in freight rates is explained by the fact that a significant portion of cargo was shipped in advance in July to avoid the August tariff deadlines, after which volumes fell sharply. Additional pressure is being exerted by the growth in container capacity, which has exacerbated the problem of global overcapacity. As a result, carriers have been unable to maintain prices, and rates on key routes continue to fall.
Rice
Price forecast
Rice
Market sentiment (for Q4 2025)
High Market Supply
According to market participants, the Asian rice market is likely to remain bearish as India and Global rice production continues to be revised upwards from initial expectations. Despite the flooding damage that occurred in September, the large over-supply of rice will continue to apply downward price pressures. Furthermore, market participants expect the future removal of the Philippines rice import ban to cause a price increase, most significantly for Vietnam.
↓ Indian Record Production and High Stocks
India is estimated to reach 150 million mt of rice production, according to the USDA. This quantity places it as the number one producer of rice globally, overtaking China. Coupled with the record high stocks, India is faced with a large oversupply of rice. USDA production forecasts for 2025/26 are at 151 million mt. As a result, market participants expect the market to remain bearish.
↓ Record Global Production and Forecasts
Global rice production in 2024/25 is projected by the USDA to hit a record 540.9 million mt, a 3.3% increase from 2023/24. The latest forecast for 2025/26 pegs rice production at 541.1 million mt.
↑ Lower Prices Encourage Purchases
The drop in international rice prices has spurred market demand and is expected to help increase consumption for 2025/26. The USDA forecasts global domestic consumption to increase 1.9% Y-O-Y in 2025/26. The increase is driven by Sub-Saharan countries such as Nigeria. This rise stems from a combination of population growth and low international prices, allowing participants to capitalize on rice imports.
↑ Punjab Flooding
India and Pakistan both suffered from heavy flooding in early September. The flood was caused by heavy pre-monsoon rains that has caused significant damage to planted crops. The Rice Exporters Association of Pakistan have estimated that around 10-12% of rice was lost, with only around 5-6% for Basmati variants. This report was further backed by a third-party and came after some exaggerated figures suggested that the loss was up to 60%. Officials have stated that despite losses, they are still able to fulfil exports. India reportedly suffered fewer losses than Pakistan and is in a better position due to record-high rice stock this year. While this may lead to prices increasing marginally in the short term, market participants expect this to be a speculative move that will be short-lived.
↑ Philippines Rice Ban Removal
The Philippine government imposed a rice ban for two months, starting on September 1. The Philippines is a key importer of rice and for 2024/25 the USDA reports 5.43 million mt of rice imported. The ban is planned to end on the October 30 and was put into place to protect domestic producers who struggled to compete with cheaper imported rice. However, there are reports that there may be an extension of 15-30 days.
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