Industry Outlook 2024-2026: Rice Industry

EXECUTIVE SUMMARY

Thai rice outputs are expected to contract through 2024 from the effects of the El Niño, which led to the delayed onset of the rainy season and reduced access to water. Therefore, in some areas, plantings have been abandoned, or the output per rai has slipped. However, total outputs will trend upwards through 2025 and 2026 due to the transition to La Niña conditions in the third quarter of 2024 that will boost rainfall, while higher prices will also encourage farmers to extend the area under cultivation. However, growers will remain saddled with high production costs. Domestic consumption from 2024 to 2026 will be boosted by the recovery of the restaurant, hotel, and food processing industries. Meanwhile, export markets will see slow growth through 2024, thanks to the suspension of exports of rice from India and the impacts of war and natural disasters on worries over food security and the need to maintain higher inventories. Nevertheless, exports are expected to weaken again in 2025-2026, as Indian rice returns to international markets and supply from other, more competitively priced producers expands, leaving less space in the market for Thai products. Thai rice prices are likewise forecast to remain elevated in 2024 before softening in 2025 and 2026 on the expected expansion in supply.

Krungsri Research view

The rice industry is facing a deepening range of challenges, which in 2024 have included drought at the start of the year and then flooding in the second half. Although outputs will strengthen in 2025 and 2026 and prices will remain high, cost pressures are eroding the ability of players across the supply chain to generate profits. These headwinds will impact the entire industry, from farmers through mills and silo operators to retailers and distributors, though SMEs will be particularly exposed to risk.

• Farmers: Rice outputs will improve over 2025 and 2026 on what is expected to be a more favorable climate and greater access to irrigation- and rainwater. In addition, government supporting measures, especially in the form of price support mechanisms, will help to shore up incomes. However, labor, energy, and fertilizer costs remain high, and farmers generally have limited negotiating power when selling their products to traders and middlemen. This will drag on growth in income.

• Mills: Although overall rice outputs will trend upward in the coming period, profits will remain under pressure from continuing problems with the extensive oversupply of milling capacity. This will be a particular problem for smaller operators, which will lose out to mid-sized and large players since the latter enjoy a stronger negotiating position when securing inputs. This will then mean that small players will have to shoulder higher costs. The most competitive players will therefore be large integrated operations and mid-sized mills that can control their costs most effectively.

• Producers of packaged rice: Income will tend to increase gradually, especially for large players that run integrated operations and control supply chains from milling through to exports. The segment will be helped by growth in demand from the household, restaurant, and tourism markets. However, the entry of new players to the market is increasing competition, while business costs are also rising, for example for marketing and paying for retail space in modern trade outlets.

• Traditional rice retailers: Against a backdrop of increasing competition from packaged rice and its advantages concerning price, convenience, and shelf-life, traditional rice sellers are expected to lose market share to modern trade outlets and the proliferating range of distribution channels. Income and profits will thus come under greater pressure as they fight against ever-stiffening competition.

• Exporters: Overseas sales will benefit from the effect of natural disasters and geopolitical conflicts that add to the worries over food security. However, the resumption of exports of rice from India and Thai players’ continuing lack of price competitiveness relative to other suppliers will drag on sales through 2025 and 2026. To maintain profitability, exporters will thus need to carefully manage costs, especially as these relate to sourcing inputs, foreign exchange, and transport.

• Silos: Income will edge up on stronger outputs and hence demand for space for the storage of rice and other cereal crops. Nevertheless, the market continues to struggle under an oversupply of silo capacity, while both exporters and mills are increasingly turning to the use of their own in-house facilities. At the same time, silo customers negotiate from a position of strength relative to operators, adding to pressure on prices and restricting the latter’s ability to generate profits.

Overview

Rice cultivation accounts for 49.1% of all Thai farmland1/ and 5.2 million households (or 67.1% of those in the agricultural sector^2/) are involved in the industry, making this Thailand’s most important crop and its major agricultural export. Given their dominance within the agricultural sector, rice farmers have naturally long been the recipients of government aid. This has included assistance with production costs, harvesting and crop improvement schemes, the provision of credit related to inventory building and the creation of added value, and projects that aim to improve management and quality control procedures.

Thailand is a globally important producer and exporter of rice, and in the 2022/2023 growing season, Thai outputs were sufficient to place the country 6th in the world rankings of production; by volume, Thai-grown rice accounted for 4.1% of global outputs, coming after China, India, Bangladesh, Indonesia and Vietnam, which produced respectively 28.3%, 26.3%, 7.0%, 6.6%, and 5.2% of the global total. Considering just exports though, Thailand ranked 2nd globally, having a 16.0% share of the global market after India, which supplied 37.1% of the total. Other competitors that Thailand faces on global markets include Vietnam, Pakistan, and Cambodia (Figure 1). However, because rice is overwhelmingly grown for domestic consumption and to ensure domestic food security, only 10.6% of global outputs finds its way to world markets (Figure 2), with exports coming from any surplus that is available after domestic markets have had their share. Imports are mostly made by countries in Africa and Asia (Figure 3).

During the 2022-2023 growing season^3/, rice cultivation covered 73.44 million rai of farmland clustered in the northeastern, lower northern and central parts of the country (Figure 4). Thai rice is typically rainfed and so the major growing season begins in May-July (the start of the rainy season) and the crop is then harvested towards the end of the year (usually in November). This is ‘seasonal’ or ‘on-season’ or ‘Major’^4/ rice and during the main growing season, regular white rice, jasmine rice and glutinous rice are all grown. 79% of the national yield is produced during this period, with the remaining 21% coming from ‘off-season’ or ‘Second’^4/ rice, that is, rice grown during the dry season. This is generally planted in November to January, but because this is dependent on artificial irrigation^5/, cultivation is largely restricted to the central and northern regions^6/.

Over the last decade, annual outputs of rice paddy have averaged 31-32 million tonnes, which after processing produces 20-21 million tonnes of milled rice. The domestic market absorbs around 10-11 million tonnes of this, with the balance either being exported or used to build stocks. This is split between the following:

1) Direct consumption accounts for around 30% of Thai paddy outputs^7/. At present, rice is distributed to consumers through three main channels.

    1.1) 49.8% of rice distributed to Thai consumers is sold pre-packed in bags. Hypermarkets are the most important channel through which pre-packaged rice is distributed (responsible for 30.6% of all rice distributed directly to Thai consumers), followed by convenience stores (12.2%) and supermarkets (7.0%).

    1.2) Rice is also sold in small local grocers and specialty shops^8/. These shops account for respectively 37.9% and 10.1% of domestic sales of rice to consumers.

    1.3) Distribution through non-grocery and e-commerce operations accounts for another 2.2% of sales.

2) Rice is used as an input into downstream processing, and so about 25% of Thailand’s paddy outputs is consumed as a raw material in other industries^7/. This is split between the following.

    2.1) 15% goes to rice processing industries, including producers of standard/long-grain rice flour, glutinous rice flour, instant rice porridge, rice noodles, rice-based snacks, alcoholic drinks, and rice bran oil; and

    2.2) 10% is used in the production of animal feed (most of which is for livestock, e.g., pork, chickens, and ducks).

3) Rice saved as seeds for the next planting accounts for a further 5% of Thailand’s paddy outputs^7/.

4) Exports soak up the remaining approximately 40% of Thailand’s paddy outputs ^7/ (Figure 6).

There are 1,477 rice mills registered in Thailand. These are typically sited near rice-growing areas since this: (1) makes it easier to source inputs; (2) cuts transportation costs; and (3) is more convenient when contacting or providing assistance to growers. The greatest concentration of these is in the central region (542 mills), followed by the Northeast (447), the North (407), and the South (81). By individual province, the largest number are in Nakhon Sawan (98 mills), which is followed in importance by Suphanburi (76), Nakhon Pathom (64), Nakhon Ratchasima (55) and Chiang Mai (52) (Figure 5).

By volume, 2023 export markets consumed 39.7% of Thai milled rice outputs. Because Thai rice is recognized globally for its high quality, it remains in demand in a large number of countries, though the most important export markets are Indonesia, South Africa, Iraq, the United States, China, the Philippines, and Malaysia. A wide range of rice products are exported from Thailand, but the main export categories are in order, white rice, parboiled rice^9/, jasmine rice, broken rice, glutinous rice, and brown and other varieties (Figure 6). These individual segments of the overall export market are described below.

• White rice: This is the most widely traded type of rice on global markets. Thai exports totaled 4.83 million tonnes of milled white rice in 2023, or 55.1% of all overseas sales of Thailand-grown rice, for which the main markets were in Asia and Africa. Indonesia was Thailand’s most important purchaser of white rice in the year, taking 25.7% of white rice exports by volume, followed by Iraq (17.6%), the Philippines (8.3%), Malaysia (8.2%), Japan (6.7%), and Mozambique (4.1%). White rice is graded according to the quantity of broken rice that it contains, cheaper varieties containing a higher proportion of this^11/.

• Parboiled rice: In 2023, Thailand exported 1.38 million tonnes of parboiled rice, and so this accounted for 15.7% of all Thailand’s rice exports. Export markets are concentrated in Africa, with the single most important of these being South Africa (60.6% of all exports of parboiled rice by volume), followed by Yemen (10.8%), Bangladesh (8.4%), Benin (7.7%), and Cameroon (2.2%).

• Jasmine rice: In the year, 15.1% of Thai rice exports were of jasmine rice (or 1.32 million tonnes of milled jasmine rice). The US was the biggest buyer of this, taking 41.0% of all exports of jasmine rice by volume, followed by China (13.5%), Hong Kong (9.2%), Canada (7.2%), and Singapore (3.8%).

• Broken rice: Thailand exported 1.02 million tonnes of broken rice in 2023, and this thus comprised 11.6% of all overseas sales. The largest buyers were Senegal (27.5% of Thai exports of broken rice by volume), Indonesia (16.5%), China (15.1%), Côte d’Ivoire (10.8%), and Papua New Guinea (4.9%). Broken rice is typically used to produce rice flour and animal feed.

• Glutinous rice: Only 1.6% of rice exports were of glutinous rice (these totaled 0.14 million tonnes of milled glutinous rice). The main buyers for this were in China (42.9% of Thai exports of milled glutinous rice by volume), the US (13.0%), Lao PDR (12.5%), Vietnam (5.6%), and Japan (4.5%).

• Brown and other types of rice^12/: This was the smallest category of exports and with total 2023 sales of just 0.08 million tonnes of milled rice, it comprised only 0.9% of the total. The most important markets were South Korea (51.7% of milled brown and other types of rice by volume), the US (10.4%), New Caledonia (6.1%), Singapore (5.2%), and China (3.7%).

Situation

The Thai rice industry benefited through 2023 from both higher outputs and stronger exports (Figure 7). The former was due to a better climate, heavier rainfall, and improved access to irrigation water, while exports were lifted by: (i) ongoing geopolitical tensions and disruption to global weather systems that then added to worries over food security and possible supply problems; (ii) the easing of transportation problems linked to portside congestion, a global shortage of containers, and high freight rates; and (iii) competitive export prices for Thai rice.

• Rice outputs climbed 2.0% to 33.6 million tonnes of paddy, or 21.9 million tonnes of milled rice in the period. (i) Strong prices and global worries about food supply pushed farmers to expand the area under cultivation, and so in 2023, this grew 1.2% YoY to 73.4 million rai. Likewise, the number of households involved in rice cultivation edged up 1.0% to 5.2 million of household^13/. (ii) Heavier rainfall, better weather overall, and improved access to irrigation water helped to push up yields by 1.5% to 479.9 kg/rai^14/, although productivity gains were held up by disruptions to the seasonal rains in 2H23. In addition, high production costs (i.e., for fertilizer, other chemicals, and energy) also meant that some farmers cut back on their use of yield-raising inputs.

• Domestic demand slumped -7.1% to 13.3 million tonnes of milled rice. This was partly a result of baseline effects and the increase in industry inventories seen in 2022, though the decline was also driven by the sluggish performance of the economy and the run-up in the cost of living, which then combined to erode consumer spending power. In the year, turbulence in global rice markets impacted the domestic price of rice, and so overall, this climbed 17.3%, split between increases of 13.3% for white rice (to THB 11,128/tonne), 6.2% for jasmine rice (to THB 14,307/tonne) and 8.5% for glutinous rice (to THB 11,741/tonne) (Figure 8).

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• Exports strengthened in 2023, rising 13.7% by volume and 29.4% by value to totals of respectively 8.8 million tonnes (of milled products) and USD 5.1 billion. Improvements were driven by worries over food security and the resulting need to build inventories, which was itself the result of: (i) ongoing disruptions to the climate that resulted in a mix of drought, delayed rains, and flooding that then weighed on outputs in the major producing and exporting nations of China, Pakistan, the Philippines, Indonesia and most importantly India^15/, which then placed limits on exports (Figure 9); (ii) shrinking inventories in major importing nations, especially in the Philippines and Indonesia^16/, which then boosted demand on global imports; (iii) the ongoing Russia-Ukraine war^17/ and uncertainty around the outlook for the global economic and political system^18/; (iv) the lifting of drags on global distribution systems that had included a shortage of containers and bulk cargo space, high freight rates, and excessive port inspections; and (v) the weakening of the baht, which helped to bring the cost of Thai exports down to a level that made them competitive with those of other exporting nations, most notably at times Vietnam (Figure 10).

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The emergence of El Niño conditions in Thailand undercut the supply of rice through the first half of 2024, but rising prices contributed to a slight lift in incomes.

• 1H24 outputs slumped under the impact of the El Niño and the resulting combination of excessive heat and lower rainfall. The Thai Paddy Production Index thus contracted -8.1% YoY on a -8.2% YoY fall in off-season planting, mainly of long-grain rice. Supply thus moved against demand on export markets, and this then pushed the Thai Paddy Price Index up by 10.0% YoY, with increases seen in the prices of white rice (+13.3% YoY), jasmine rice (+6.2% YoY) and glutinous rice (+8.5% YoY). These two trends then largely canceled each other out, with incomes inching up by just 0.2% YoY in the period (figures 11-13), although with the cost of inputs (e.g., energy, fertilizer and labor) remaining high, profits came under increased pressure.

• Exports strengthened through the first half of 2024. Demand was boosted by the decision by the Indian authorities to restrict overseas sales of rice, which then naturally forced countries to source a greater share of their imports from Thailand. In addition, the need to build inventories and to deepen domestic food security in importing nations was amplified by intense geopolitical strains and the El Niño-driven disruption to the climate. Thai rice exports therefore jumped 25.3% to 5.1 million tonnes of milled products over 1H24, and this then generated receipts worth USD 3.3 billion (+48.1%). In the period, Thailand’s most important markets were Indonesia (the destination for 20.5% of rice exports by volume), Iraq (9.9%), the US (7.9%), South Africa (7.2%) and the Philippines (5.7%). The most important export products were white, broken, jasmine and glutinous rice since in these markets, Thai goods are both well-known and recognized for their quality (Table 1). Details of exports are given below.

  • White rice: Exports jumped 38.4% YoY by volume and 74.8% YoY by value to totals of 3.1 million tonnes of milled white rice and USD 1.94 billion. Average export prices were also up 26.3% YoY to USD 618.8/tonne. In the period, the main markets were Indonesia (the destination for 31.8% of all exports of white rice from Thailand by volume), Iraq (16.0%), the Philippines (8.7%), Mozambique (5.6%) and Japan (4.6%).

  • Parboiled rice: 1H24 exports came to 0.5 million tonnes of parboiled rice, which then generated USD 311.4 million in income. These figures represented declines of respectively -23.8% YoY and -1.5% YoY, though export prices climbed 28.2% YoY to USD 603.3/tonne. Exports went to South Africa (64.7% of exports of Thai parboiled rice by volume), Yemen (12.2%), Algeria (4.3%), Benin (3.6%) and Tunisia (2.6%).

  • Jasmine rice: By volume and value, exports rose by 17.3% YoY and 19.6% YoY to totals of 0.7 million tonnes of milled jasmine rice and USD 621.4 million. Over 1H24, export prices moved only slightly, climbing 2.0% YoY to an average of USD 951.0/tonne. The most significant overseas were the US (45.7% of jasmine rice exports by volume), Hong Kong (9.4%), Canada (6.8%), China (4.7%) and  Singapore (4.3%).

  • Broken rice: Overseas sales of broken rice surged 57.6% YoY by volume and 75.1% YoY by value to respectively 0.7 million tonnes of milled rice and USD 346.8 million. Average export prices also climbed 11.3% YoY to USD 523.8/tonne. In the period, the most important markets were Senegal (28.1% of broken rice exports by volume), Côte d’Ivoire (22.1%), China (9.9%), Indonesia (6.5%) and Papua New Guinea (5.8%).

  • Glutinous rice: Although exports remain slight, these improved 8.2% YoY by volume (to 0.09 million tonnes of milled glutinous rice) and 17.9% by value (to USD 66.7 million). Per-tonne export prices also rose 10.3% YoY to an average of USD 786.0, with the most important export targets being China (54.7% of exports of glutinous rice by volume), the US (10.7%), Japan (6.7%), Hong Kong (5.3%) and Vietnam (3.4%).

  • Brown rice and other rice products: The smallest segment of the market endured declines of -64.0% YoY in export volume (to 0.02 million tonnes), although because average export prices were up 35.4% YoY to USD 1,207.1/tonne, export value declined by only -37.7% YoY (to USD 20.4 million). The main overseas buyers in this category were the US (29.4% of brown rice and other rice products exports by volume), Singapore (12.1%), Italy (8.2%), Taiwan (6.8%) and Canada (6.3%)

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Outlook

• Overall outputs are expected to decline by between -5.0% and -6.0% in 2024. As such, the combined harvest will drop to 31.6-31.9 million tonnes of paddy or 20.6-20.8 million tonnes of milled products. Output has been hurt by El Niño conditions, which resulted in the delayed onset of seasonal rains and reduced rainfall. This then forced some farmers to leave their fields fallow, and so per-rai yields contracted, though this was especially a problem in areas outside irrigation systems and so have been repeatedly exposed to drought. However, over 2025 and 2026, output is expected to rise 4.0-5.0% yearly and lift the annual harvest to 34.4-35.1 million tonnes of paddy or 22.4-22.8 million tonnes of milled rice (Figure 14), thanks to: (i) the swing into La Niña conditions in the third quarter of 2024 that will trigger an increase in rainfall, the onset of more favorable climatic conditions overall, and an improvement in access to irrigation water (Figure 15); (ii) strengthening farmgate prices in 2024; and (iii) government support for rice farmers that includes loans that help to delay the release to the market of new on-season paddy, loans to help players build stocks and add value, measures to maintain stability within the rice market, help with production costs, and plans to better manage water resources for the agricultural sector^19/. These will together help to encourage farmers to continue and to extend their cultivation of rice. Production costs (fuel, pesticides, and fertilizer), however, will remain elevated. If this forces farmers to cut back on their use of fertilizer, this will drag on average per-rai yields and undercut growth in the size of the national harvest.

• Demand from the domestic market will rise by 2.0-3.0% annually, from the 2022/2023 total of 13.3 million tonnes of milled rice to 14.2-14.6 million tonnes of milled rice in 2025-2026. Growth will be supported by: (i) ongoing recovery in tourism sector^20/, with rising tourist arrivals buoying demand from restaurants and hotels; (ii) stronger demand from downstream industries, especially food processors, which are increasing their consumption of rice; and (iii) improving consumer spending power lifted by greater demand for labor from restaurant chains/franchises, educational institutions, hospitals, and factories. This will nonetheless be balanced by the high cost of living and the impact of this on slowing recovery in purchasing power through 2024.

• 2024 exports are forecast to edge up by 0.5-2.5% to 8.8-9.0 million tonnes of milled rice due to (i) India, one of Thailand’s major competitors, has restricted exports of all non-basmati rice since July 2023, as it tries to tackle the rise in food prices and assure the population that domestic supply is sufficient to meet demand. This has then created space in international markets that Thai suppliers have been able to fill. (ii) Thailand has concluded an agreement with the Indonesian authorities to supply the country with a significant quantity of rice^21/. (iii) Unfavorable weather disrupted the harvest in many countries, so to ensure food security, these have had to turn to international markets for additional supplies and replenish inventories^22/. (iv) Geopolitical stresses, most obviously the extended war in Ukraine, have tightened the global supply of major arable crops, and this has added to the demand for both regular and broken rice for consumption by humans and for processing into animal feed. However, these gains will be lost over 2025 and 2026, and through these two years, exports are expected to contract by between -5.0% and -6.0% annually, thereby falling to 7.8-8.0 million tonnes of milled rice per year. These declines will be driven by: (i) the onset of La Niña conditions, which will boost global rice outputs and likely allow India to resume exports; and (ii) the increased price competition that will give opportunity for Thailand’s main competitors (India, Pakistan, and Vietnam) once supply problems clear.

• The export prices of Thai rice will remain high through 2024 thanks to a combination of falling global inventories and rising demand (Figure 16). Traders wishing to fulfill export orders will be forced to compete with one another to source rice on the domestic market, and this will tend to lift prices across the year. However, in 2025 and 2026, the onset of La Niña and resulting heavier rainfall will increase supply from late 2024 onwards, weighing down on prices. Nevertheless, continuing geopolitical stresses, especially war, will keep the focus on issues related to food security. This will in turn help to buoy demand and keep prices still at a high level.

Future developments within the rice industry

• Raising product standards, expanding the customer base, and increasing choice: Rice is both an essential commodity and is in a perfectly competitive market. Players within rice supply chains are therefore trying to establish niche markets or to build and strengthen brand loyalty by raising the quality of their goods and improving their product differentiation (e.g., by developing GI rice^23/, rice that has a lower carbohydrate content, and rice that can be stored for longer without its quality degrading). Companies are also trying to connect with all consumer demographics by distributing through both offline channels (i.e., modern and traditional retailers) and online platforms. Moreover, players are packaging their goods in a range of sizes that better meet market demand and spending power, for example by placing small packages in convenience stores for purchase by consumers while also selling large sacks of rice to restaurants.

• Applying modern technology to organizational processes: This includes automating production processes, using AI to cut the time spent on product inspections and quality control, and electrifying production and distribution, thus allowing the use of fossil fuels to be phased out.

• Supporting the SDGs and the ESG goals^24/: Extending the range of corporate concerns to encompass stakeholders, local communities, and the wider environment will include the following:

  • The environment: Changes here will include reducing greenhouse gas emissions, raising the efficiency of energy and water use, improving the treatment of wastewater, and ensuring that the management of waste and byproducts is effective across the length of the supply chain.

  • Social: This will entail improving community agricultural skills, collaborating with communities on environmental and safety issues, sourcing inputs and hiring labor locally, strictly adhering to local laws, and providing food assistance to communities when needed.

  • Governance: Under this category, transparency and accountability in procurement and contracting will be assured, product research and development will be pursued, all employees will be treated fairly and equitably, full support will be given to individuals affected by a disability, and company-wide anti-corruption policies will be vigorously pursued.

1/ 2021 data on the ratio of rice planted area to Thailand’s agricultural land use comes from the Office of Agricultural Economics.
2/ Data on the number of households planting on- and off-season rice in 2022/2023 is supplied by the Office of Agricultural Economics and the Ministry of Agriculture and Cooperatives.
3/ 2023 outputs are calculated from on- and off-season rice planted in the 2022/2023 growing season.
4/ Seasonal rice is generally grown from strains that produce grain on a predictable timetable since these varieties use the day length to determine their growth, and as the days shorten (i.e., as the climate moves from the rainy season into winter), seasonal rice varieties will switch from vegetative growth to reproduction. These types of rice are thus classified as ‘photoperiod sensitive’, and in Thailand, favored varieties include Khao Dawk Mali 105, RD 15, RD 6, and Prachinburi 1. However, because of the time of year during which off-season rice is grown, day length is not an appropriate determinate of the growing cycle and so growers instead use rice that produces grain after a fixed period of time (generally 90-150 days) regardless of the planting season. Preferred varieties for off-season rice include Phitsanulok 2, Suphanburi 1, Pathumthani 1, and Chainat 1.
5/ The main irrigated areas in Thailand (accounting for 80-90% of all the country’s irrigated farmland) receive water from the Bhumibol and Sirikit dams, which are located in the Chao Phraya watershed.
6/ In the 6 south-eastern provinces of Nakhon Ratchasima, Phatthalung, Songkhla, Pattani, Yala, and Narathiwat, seasonal rice is grown from mid-June to the end of February in the following year. Off-season rice is thus grown from March to mid-June.
7/ Source: Comprehensive Rice Production and Marketing Action Plan (2022/2023), and analysis by Krungsri Research.
8/ ‘Specialty shops’ includes food, drink, and tobacco retailers (e.g., bakeries, sellers of fresh fruit, etc.)
9/ Parboiled rice is prepared by soaking paddy rice until it has a moisture level of 30-40%. The rice is then steamed or boiled until cooked, dehydrated and then milled to remove the husk. The parboiling process improves the quality of the milling, reduces the proportion of broken rice, and because the soaking pulls nutrients out of the bran and germ and into the grain, it also raises the final product’s nutritional value. Parboiling gives the rice a pale-yellow color.
10/ Broken rice is rice that is damaged during processing and that has a length from 2.5 parts or partially damaged in any parts up to 80% of full grains. Broken rice is mostly consumed by mixing with whole grains to make 25% white rice, though some is also used in downstream industries for the production of animal feed, flour, and beer.
11/ As per the 1997 Ministry of Commerce guidelines on rice quality, sample grades are as follows: (i) 100% white rice is the highest quality and Level 1 100% white rice contains no more than 4% broken rice; (ii) 5% white rice is 5-7% broken rice; and (iii) 25% white rice is 25-28% broken rice.
12/ Brown rice comprises the majority of this category, with the remainder consisting of other types of rice and rice products, including rice seed for planting.
13/ The combined total of families growing on- and/or off-season rice. Source: Office of Agricultural Economics.
14/ Thailand continued to benefit from the La Niña through the first half of 2023, and so with access to irrigation water holding up, outputs of off-season rice rose. However, through the second half of the year, the temperature rose, the rains were disrupted, and in some areas, water shortages set in. Outputs for the year’s main seasonal rice crop thus suffered.
15/ India banned exports of all types of non-basmati rice, for which the government set a minimum export of basmati rice price of USD 1,200/tonne, as well as imposing a 20% surcharge on exports of parboiled products. These restrictions came into force on 20 July 2023, and at the time of writing, these remain in effect.
16/ The Philippines had to increase imports to maintain its 90-day stocks of milled rice (around 3.4 million tonnes). Indonesia also stepped up imports of rice to keep inventories at some 1.0-1.5 million tonnes, thereby helping to stabilize domestic rice prices (source: Reuters, The Jakarta).
17/ The war began in 2022 with Russia’s invasion of Ukraine, but because the latter is a major agricultural exporter, this pushed up global prices for arable crops, most obviously corn and wheat. In response, consumers switched to buying rice in greater quantities, while in some countries, higher prices encouraged farmers to move from growing rice to planting corn and wheat instead, thus adding to demand for imports. Thai exporters were subsequently one beneficiary of this.
18/ For example, banning exports of rice in response to rising inflation and the impacts of changes to government policy.
19/ On 18 June 2019, the cabinet gave the go-ahead to the 20-year water resource management plan (for the years 2018-2037). This aims to solve long-running nationwide problems with water management and to develop access to national water resources. The plan is being implemented primarily by the Office of National Water Resources, and has 6 main concerns: (i) managing water supplies for general use; (ii) ensuring security of supply to the agricultural sector; (iii) managing floods and flood prevention; (iv) managing water quality and preserving water resources; (v) preserving and reviving degraded forests in watersheds and preventing soil loss; and; (vi) general management of water resources.
20/ The Thai Farmers Association sees 2024 demand for rice from foreign tourists rising 24% to 0.05 million tonnes of milled rice.
21/ Demand for rice from Indonesia has surged thanks to a government project to supply 10 kilograms of rice per month to over 20 million low-income earners. This scheme will run until December 2024 (source: Office of Agricultural Economics.)
22/ For example, drought in the Philippines undercut outputs and as a result, supply was insufficient to meet local demand. In response, the authorities have cut tariffs on rice from 35% to 15% for both within-quota and above-quota imports. These measures will stay in place until 2028. Likewise, Mexico and Brazil, which have also been affected by drought, have moved to build food security by encouraging greater food imports. At the other end of the scale, Kenya has been hit by floods and so has waived tariffs on rice imports until 30 November 2024 (source: National Economic and Development Authority of the Philippines, Kenyan Ministry of Finance).
23/ At present, 23 rice products are registered as a ‘geographical indication’ or GI. These include Surin Hom Mali Rice, Khao Leuang Patew Chumphon, Sang Yod Phattalung Rice, Khao Hom Mali Thung Kula Rong-Hai, Khao Rai Leum Pua Petchabun, Khao Niew Khiaw Ngoo Chiang Rai, Khao Jek Chuey Sao Hai, and Khao Kum Lanna (source: Department of Intellectual Property, 16 July 2024).
24/ The Sustainable Development Goals (SDGs) are grouped into 5 primary areas (the ‘5Ps’): (i) people, which is focused on the eradication of poverty and hunger, and the reduction of social inequality; (ii) planet, or the protection of natural resources and the preservation of the climate for future generations; (iii) prosperity, which is concerned with promoting well-being for all in harmony with the natural environment; (iv) peace, which is concerned with the maintenance of stable coexistence among all peoples, and the preservation of peaceful and inclusive societies; and (v) partnership, or the promotion of cooperation between all parts of society to push for sustainable development (source: Office of the National Economic and Social Development Council).