International Rice prices under stress

09-Jul-2025 03:33 PM

Hyderabad. Rice prices in the global market remain subdued due to higher supply and availability than demand and off-take.

The all-rice price index of the Food and Agriculture Organization (FAO), a United Nations agency, has dropped to its lowest level in five years.

The market continues to experience a downward trend, with the export offer price of Thailand’s 5 percent broken white rice falling below $400 per tonne — a level not seen in a long time.

India, the world's largest rice producer and exporter, has now fully deregulated commercial exports of all rice varieties and categories. According to FAO and other international bodies, including the US Department of Agriculture (USDA),

global rice production is expected to hit a new record during the 2025–26 marketing season, thanks to favorable weather conditions in major producing countries, including India. This suggests that global rice prices are unlikely to recover significantly in the near future.

Production estimates for both the 2024–25 and 2025–26 seasons have been revised upward. In addition to India, higher production is also expected in Bangladesh, Pakistan, and Vietnam, while estimates for Iraq and the United States have been revised downward. The FAO reported that its rice price index fell by 2.2 percent to 105.5 points.

In June, rice trade across Asian markets slowed, primarily due to weak demand in importing countries and some disruptions in container shipping caused by rising freight costs.

Rice prices have remained under pressure since the start of 2025, a stark contrast to 2024 when prices soared following India’s temporary export ban on certain rice varieties.

With all export restrictions and duties now lifted, India is sitting on a large exportable surplus and is expected to see another strong harvest, potentially reaching a new all-time production high.