1. Weekly News

Brazil

Brazil's 2023/2024 Grain Production Estimated at 298.41 MMT

Brazil's grain production is estimated at 298.41 million metric tons (mmt) in the 2023/24 harvest, marking a decrease of 21.4 mmt from the previous record cycle. The National Supply Company (CONAB) attributed this reduction mainly to delays in rainfall regularization at the start of the planting window and insufficient rainfall during critical growth periods in the Center-West region, Matopiba, São Paulo, and Paraná. Furthermore, excessive rain in Rio Grande do Sul negatively affected first-harvest crops. On a positive note, rice production is projected to reach 10.59 mmt, reflecting a 5.5% year-on-year (YoY) increase, showing some resilience amidst the overall decline in grain output.

Brazil's Rice Exports Declined in Aug-24

Brazilian rice exports (husk-based) amounted to 164.4 thousand metric tons (mt) in Aug-24, generating revenue of USD 66.2 million, as reported by the Brazilian Rice Industry Association (ABIARROZ) based on data from the Ministry of Development, Industry, Commerce and Services (MDIC). This marks a significant decline of 41.5% YoY in shipment volume compared to Aug-23 when exports totaled 280.9 thousand mt. Revenue also fell by 32% YoY from USD 97.4 million in Aug-23. Additionally, milled rice exports reached 103.5 thousand mt, yielding USD 36.8 million in Aug-24. This decreased from Aug-23 when processed rice shipments amounted to 130.9 thousand mt and generated USD 40.1 million in revenue.

Egypt

Egypt Set to Cut Rice Cultivation Area by 32% YoY for 2024 Season

For the 2024 rice planting season, Egypt forecasted a 32% YoY decrease in rice cultivation area from 1.1 million acres to 750 thousand acres. The rice planting season typically begins in May, particularly in the Delta and Lower Egypt governorates, with the harvest period extending from mid-August to the end of October.

Indonesia

Indonesia's Rice Imports Surged Over 121% in Early 2024

According to new data from the Central Bureau of Statistics of Indonesia (BPS), Indonesia imported 3.05 mmt of rice valued at USD 1.91 billion from Jan-24 to Aug-24, marking an over 121% YoY increase. This rice import accounted for 1.5% of Indonesia's total non-oil imports. The top three rice suppliers to Indonesia during this period were Thailand, which exported 1.13 mmt worth over USD 734 million, followed by Vietnam, which supplied 870 thousand mt, valued at more than USD 542 million and Pakistan. In response to rising demand, the Indonesian National Logistics Agency (BULOG) announced a rice tender in Sep-24 for 450 thousand mt of 5% broken white rice from the 2024 crop year, with specified origins including Vietnam, Thailand, Myanmar, Cambodia, and Pakistan, to be delivered in Oct-24 and Nov-24. Additionally, Indonesia's total food imports reached USD 14.48 billion in the first eight months of 2024, reflecting a 3.43% YoY increase. The country recorded a trade surplus of USD 2.9 billion in Aug-24, marking the 52nd consecutive month of surplus.

Philippines

Philippines Cuts Rice Import Tariffs to Lower Consumer Prices

The Philippines' Agriculture Secretary announced a significant reduction in tariff rates for imported rice, lowering them from 35% to 15%, effective Jan-25. This change will lower consumer rice prices, with a preliminary decline expected on Oct-24. Despite a rise in global rice prices driven by demand from Malaysia and Indonesia, the Department of Agriculture does not intend to increase the tariff rate for imported rice in the forthcoming review of Executive Order 62 (a multi-year comprehensive tariff schedule and applies to commodities subject to the Most Favored Nation (MFN) rates). Meanwhile, a farmers and organizations coalition has petitioned against this executive order, requesting a temporary restraining order.

2. Weekly Pricing

Weekly Rice Pricing Important Exporters (USD/kg)

Yearly Change in Rice Pricing Important Exporters (W38 2023 to W38 2024)

India

In W38, wholesale rice prices in India rose by 4.48% week-on-week (WoW), 6.06% month-on-month (MoM), and 16.67% YoY, reaching USD 0.70 per kilogram (kg). This price increase is primarily due to ongoing food inflation in India, which has remained around 8% YoY since Nov-23. Additionally, the government's recent removal of the minimum export price (MEP) for basmati rice has led to a surge in global inquiries, significantly boosting demand. As a result, basmati rice prices, which had previously declined due to reduced global orders, are rising.

Thailand

In W38, wholesale prices for Thai 5% broken rice remained stable WoW at USD 0.56/kg but experienced a decline of 1.75% MoM and 11.11% YoY. Thailand forecasted an increase in milled rice production to 20 mmt in the 2024/25 season, up from 19.7 mmt in the previous season, driven by higher farm-gate prices and improved yields. However, despite this production boost, rice exports are forecasted to decrease to 7.5 mmt in 2024/25, down from 8.2 mmt in 2023/24 and 8.7 mmt in 2022/23. This anticipated decline is primarily attributed to the volatility of the Thai baht and increased competition from major rice-exporting countries such as Vietnam, Cambodia, and India.

Vietnam

In W38, wholesale prices for Vietnamese regular rice remained stable WoW and MoM but experienced a YoY increase of 5.08%, reaching USD 0.62/kg compared to USD 0.59/kg in W38, 2023. Vietnam's rice exports are forecasted to achieve a record turnover of approximately USD 5 billion in 2024, fueled by strong demand from traditional markets such as the Philippines, Indonesia, and Malaysia, which rank among Vietnam's top rice export destinations. Although prices for certain rice varieties in the Mekong Delta have slightly declined, overall export prices have remained steady. From Jan-24 to Aug-24, Vietnamese rice exports reported a 5.8% YoY increase in volume and a 21.7% YoY rise in revenue, reflecting the growing demand in the region.

United States

In W38, the wholesale price of United States (US) milled white long rice in Arkansas decreased 1.25% WoW and MoM, settling at USD 0.79/kg. Moreover, this marks a 3.66% YoY decline. The USDA reports that the rice harvest in Arkansas is advancing well, with no significant weather disruptions or poor crop conditions. By W36, over 25% of the state's rice crop had been harvested, with 76% rated as good or excellent. The next crucial step will be receiving early mill yield reports from the field in the coming weeks, providing deeper insights into the crop's performance this year.

3. Actionable Recommendations

Invest in Precision Agriculture Technologies

Brazil and India can invest in precision agriculture technologies to significantly enhance rice production. By employing advanced tools such as data analytics, satellite imagery, and Internet of Things (IoT) devices, farmers can optimize crucial factors like water usage, fertilizer application, and pest management. For instance, precision irrigation systems can help ensure crops receive the exact amount of water they need, reducing waste and increasing efficiency. Moreover, precision farming can facilitate targeted pest control measures, minimizing chemical usage and promoting environmental sustainability. By adopting these technologies, farmers can increase crop yields and reduce input costs, improving their profit margins. Moreover, the insights gained from these technologies can help farmers make informed decisions, allowing them to mitigate risks associated with climate variability, such as droughts or excessive rainfall.

Promote Agricultural Cooperatives Among Smallholder Farmers

Indonesia and the Philippines should promote the formation of agricultural cooperatives among smallholder farmers in countries by providing essential access to shared resources and strengthening their market position. These cooperatives enable farmers to pool their resources for bulk purchasing of high-quality seeds, fertilizers, and modern farming equipment, which may otherwise be unaffordable for individual farmers. By collaborating on marketing strategies, these cooperatives can enhance their bargaining power, leading to better product pricing. Furthermore, cooperatives can facilitate training programs and knowledge sharing, helping farmers adopt best practices in cultivation and post-harvest handling. This collective approach increases income stability for smallholder farmers and fosters community resilience and empowerment, enabling them to adapt to changing market dynamics more effectively.

Establish Public-Private Partnerships for R&D

Vietnam and Thailand should establish public-private partnerships focused on research and development (R&D) to develop high-yield and climate-resilient rice varieties. Collaborations between government agencies, private enterprises, and research institutions can accelerate the introduction of innovative farming practices that respond to local and global challenges. These partnerships can facilitate sharing knowledge, resources, and expertise, leading to the development of rice strains more resistant to pests, diseases, and changing climate conditions. Moreover, investing in R&D can foster the development of sustainable farming practices that reduce environmental impact while enhancing productivity. By positioning themselves as leaders in agricultural innovation, these countries can improve food security domestically and boost their export potential, making them more competitive in the global rice market.

Sources: Defrentealcampo, WTOCenter, Planetaarroz, EGmasrawy, Vov, Economic Times