Falling world rice prices to 8-year low will limit wheat price growth

According to the World Bank (WB), the price of benchmark Thai rice with a broken grain content of up to 5% fell by 6.4% in July to an 8-year low of $392/t after major exporting countries (including India) lifted restrictions on export sales.

Other Thai rice varieties also fell in price. For example, the cost of rice with a broken grain content of up to 25% decreased by 6.4% to $382/t, and milled white rice – by 4.4% to $376/t, which are the lowest figures since autumn 2017.

The price of Vietnamese rice in July decreased by 1.7% to $370.6/t, the lowest level since February 2020.

September futures for raw rice in Chicago fell 19% year-on-year to $125/t (-45% in two years) as several major producers (including Thailand and India) lifted their temporary export restrictions, increasing supply on the global market.

In addition, Vietnam displaced Thailand from second place among the world's largest rice exporters, increasing shipments by 3.6% to 4.72 million tons in the first half of the year.

Global rice production is expected to reach a record 543 million tonnes this year, so supply will significantly exceed consumption, putting pressure on prices for wheat and other grains.