The global market price of rice has recently fallen by over 5% due to a combination of weak demand from importing countries and an increase in supply.

The abundant availability of rice, especially due to strong production in India, has been a major factor in this price drop. India's increased activity in the international rice export market has contributed to the surge in supply.

In particular, the price of Sona Masuri rice from Chennai has dropped significantly from Rs 6200 per quintal to Rs 4200 per quintal.

Despite the decrease in price, there is still good demand for Indian rice, especially in markets such as the European Union, where Sona Masuri rice is sold at around Rs 5200–5400 per quintal.

However, exports to Sri Lanka have sharply reduced due to the government there setting a price ceiling for rice, discouraging further imports from India.

Meanwhile, Malaysian importers are trying to negotiate lower prices for Sona Masuri rice, offering a price of $490 per tonne (including transportation and insurance), but Indian exporters are holding firm at $580 per tonne due to rising shipping costs. As a result, the negotiation process has become more contentious.

The weak demand for Indian rice is also tied to price differences between India and other major rice exporters like Thailand and Vietnam.

Although the export price of Indian rice has not fallen significantly compared to its competitors, the strengthening of the dollar has made Indian rice more attractive on the global market, providing higher margins for exporters despite the reduced demand.