With global rice supplies plentiful, rice prices have escaped the volatility besetting most other grains. While rice futures are up nearly 6% so far this year, wheat, for example, has gained more than 40%, and corn is up 33%.
The price differentials are boosting demand for rice as a substitute for other grains, including in animal feed. China’s rice imports are currently forecasted to be at their highest levels since 2018. Much of China’s imports are of broken rice, which is cheaper than whole grain rice.
China’s increased rice imports could in turn reduce its need to import higher-priced corn. So far this season China’s corn imports are down year over year. China has recently turned to the US for corn imports as shipments from Ukraine, its second-largest supplier of corn imports, are halted.
China is the world’s largest producer of rice, but domestic rice prices don’t usually favor its use in animal feed because the rice first needs to be dehulled, which can add some 30% to its final cost.
Rice is the primary staple for more than half the world's population. Strong production in major exporting countries, including India, Thailand, and Vietnam, has bolstered global rice inventories. Rice stocks-to-use ratio, a key measure of supply availability, is at 27% for the major exporters, the highest in recent history. By contrast, wheat stocks-to-use are at their lowest level since 2013.
India had a bumper rice harvest last year, boosting exports to record levels in 2021/22, especially to Africa and neighboring countries in Asia. India’s next rice crop will be planted in June-July and production prospects will depend to a great extent on the monsoon rains.
Since the monsoon’s impact can vary across the country, the Gro Climate Risk Navigator for Agriculture provides growing conditions at the state level, including this display showing West Bengal, India’s largest rice-growing state, and this one showing Odisha, another big rice-producing state.
Rice planting in Thailand starts in May, the beginning of the rainy season. Thailand is currently seeing above average rains, which is necessary for planting, and soil moisture remains high. Cumulative precipitation is the highest in at least 20 years, according to Gro's Climate Risk Navigator.