1. Weekly News

Brazil

Brazil's Rice Trade Surges in Jul-24 with Near-Doubling of Exports and Imports

Brazil saw a significant increase in rice exports and imports in Jul-24, with volumes nearly doubling compared to the previous month. Despite the rising value of the United States (US) dollar, which reached levels not seen since Dec-21, rice imports hit a three-and-a-half-year high. According to data the Center for Advanced Studies on Applied Economics (CEPEA) analyzed, 204.2 thousand metric tons (mt) of rice (paddy equivalent) were imported, marking a 90.72% month-on-month (MoM) increase from Jun-24 and a 62.71% year-on-year (YoY) rise from Jul-23. On the export side, Brazil shipped 174.89 thousand mt of rice (paddy equivalent) in Jul-24, representing a remarkable 180.43% MoM increase, though it was 2.78% YoY lower.

Myanmar

Floods and Conflict Lead to Significant Reduction in Myanmar's Rice Production

Myanmar is facing a significant reduction in rice production in 2024 due to severe flooding during the rainy season, which has submerged and damaged over 100,000 acres of rice fields in key rice-growing regions like Ayeyarwady, Bago, Yangon, and Sagaing. Lasting over ten days, the prolonged flooding left some rice seedlings buried in silt, while others have started to grow but are likely to produce lower yields. Farmers are reporting difficulties in replanting the damaged fields, further exacerbating the expected decline in production. Additionally, the ongoing conflict in the region has reduced the overall area of rainy-season rice cultivation. This combination of factors will likely lead to a significant drop in rice output, driving up prices due to increased domestic and export demand. Traders are already anticipating a spike in rice prices due to these challenges.

Philippines

Philippines' Rice Imports Reached 2.44 MMT in Late July, Driven by Tariff Reductions

The Philippines imported 2.44 million metric tons (mmt) of rice in Jul-24, according to the Bureau of Plant Industry (BPI). While rice shipments totaled 101,013 mt, this was lower than the 156,981 mt recorded in Jul-23. The recent reduction in rice import tariffs from 35% to 15%, effective until 2028 under Executive Order No. 62, is expected to boost imports in the coming months. The Department of Agriculture anticipates increased imports, with 557,815 mt approved in sanitary and phytosanitary import certificates for July alone. Vietnam remains the top rice supplier, providing 75% of the imports to date (1.83 mmt), followed by Thailand (358,727 mt) and Pakistan (154,523 mt). Myanmar and India also contributed 66,640 mt and 21,605 mt, respectively.

Vietnam

Vietnamese Rice Gains Edge in Philippine Market as Tariff Reductions Boost Export Prospects

Vietnamese rice continues to dominate the Philippine market, which has been Vietnam's largest rice export partner for years. With the Philippines reducing rice import tariffs from 35% to 15% in Jun-24, valid until 2028, and expected to increase imports from 4 mmt to 4.5 mmt, there is significant potential for Vietnamese to export rice in the latter half of the year. However, businesses remain cautious due to high input costs and the potential impact of storms and floods, which could reduce the rice supply. This caution has led to hesitancy in signing new export contracts. The Vietnam Trade Office in the Philippines advises businesses to carefully balance costs to offer competitive prices and maintain market share. The Ministry of Industry and Trade is committed to supporting businesses through trade promotion, advertising, and enhancing product quality to boost export value. Despite a 3% decline in export volume to the Philippines last year, Vietnam's rice export turnover increased by 17.6%, reaching USD 1.75 billion due to higher prices.

2. Weekly Pricing

Weekly Rice Pricing Important Exporters (USD/kg)

Yearly Change in Rice Pricing Important Exporters (W33 2023 to W33 2024)

India

In W33, wholesale rice prices in India remained unchanged week-on-week (WoW) at USD 0.66 per kilogram (kg). However, the MoM price dropped 1.49%. This price drop follows an increase in the area of paddy sowing to 16.61 million hectares (ha) by July 19, 2024, compared to 5.56 million ha by the same date in 2023. The rise in the sowing area suggests a potential increase in rice production, estimated between 135.5 and 138 mmt for the Kharif crop year 2024/25, up from 111.46 mmt in the previous year. However, prices might rise if the monsoon fails and output is lower than expected.

Vietnam

In W33, wholesale prices for Vietnamese regular rice remained stable WoW and MoM, but increased 1.64% YoY to USD 0.62/kg. Despite this stability, prices are anticipated to rise, potentially reaching their peak after six months. This expected increase is attributed to successful bids to supply rice to Indonesia and heightened global demand driven by adverse weather impacting food security. Domestic rice prices in the Mekong Delta provinces have also risen. However, there are concerns that Vietnam may need help to meet the anticipated demand surge in the Philippines and Indonesia due to limited production capacity and the nearing end of the summer-autumn crop season.

United States

In W33, the wholesale price of US-milled white long rice in Arkansas remained unchanged at USD 0.80/kg, reflecting a 2.44% decrease YoY. Despite facing challenges such as Iraq's banking issues and the crisis in Haiti over the summer months, the US’ milled rice market demonstrates resilience, primarily due to favorable harvest conditions. Iraq has resumed purchasing US rice following uncertainty caused by American financial restrictions. Efforts are now concentrated on strengthening export markets and enhancing internal relations to sustain market stability.

3. Actionable Recommendations

Enhance Brazil's Rice Export Strategy and Diversify Markets

Brazil's substantial increase in rice exports in Jul-24 highlights an opportunity to enhance its export strategy further. Brazil should focus on diversifying its export markets beyond traditional partners to capitalize on this growth. Expanding trade relationships with emerging markets in Africa and the Middle East, such as Nigeria and Egypt, could provide additional stability and growth opportunities. Investing in marketing efforts and trade agreements with these regions can help Brazil secure new markets and mitigate economic fluctuations and market saturation risks. Additionally, improving logistical infrastructure, including port facilities and transportation networks, will support more efficient distribution and meet rising export demands.

Address Production Challenges and Support Myanmar's Rice Sector

Myanmar's rice production is severely impacted by flooding and ongoing conflict, which threatens to drive up domestic and export prices. To mitigate these challenges, Myanmar should focus on immediate support measures for affected farmers, such as providing financial aid and resources for replanting and recovering damaged fields. Investing in flood-resistant rice varieties, such as IR64 Flood-Tolerant, Swarna Sub1, FR13A, Shao You 73, and BR11, can significantly enhance resilience to adverse weather conditions. These varieties are specifically developed to withstand submersion and prolonged flooding, making them well-suited for Myanmar's flood-prone areas. Additionally, improving irrigation infrastructure can further support flood management. Strengthening conflict resolution efforts and ensuring stability in key rice-growing regions will also support long-term production and market stability. These actions will help Myanmar recover from current setbacks and sustain its rice sector's contribution to both domestic and global markets.

Leverage Tariff Reductions to Boost Rice Imports in the Philippines

The Philippines' recent reduction in rice import tariffs presents a strategic opportunity to enhance rice imports and stabilize domestic supply. The country should focus on securing long-term supply agreements with significant rice exporters such as Vietnam and Thailand to maximize this advantage. Expanding import volumes to meet the anticipated demand and addressing logistical challenges will ensure a steady rice supply. Additionally, implementing measures to streamline the import process and improve market access can help mitigate price volatility and enhance food security. These steps will help the Philippines manage its rice supply effectively and maintain stable market conditions.

Sources: Voh, Foodmate, NoticiasAgricolas, UkrAgroConsult, AgroInfo.vn