Global Rice Market Shifts Put Pressure on Thai Farm Incomes

• Rising global supplies and stocks, along with weaker trade outlook, are likely to pressure rice prices.
  
  
• Strong competition from India and Pakistan and low farmgate prices are pushing Thailand farmers to shift away from rice.
  
  

Rice remains central to Thailand's economy, supporting around 4.68 million farming householdsnearly 61% of agricultural householdsand engaging roughly 20 million people nationwide. Cultivated over 11.52 million hectares, rice is a key determinant of rural incomes, making global market trends highly influential for the sector.

Global Supply Sees Marginal Increase

According to the USDA April 2026 Rice Outlook, global rice production for MY 2025/26 is projected at 541.4 MMT (milled basis), slightly higher than earlier estimates. The increase is driven by improved output in Thailand, supported by favorable weather, offsetting declines in the Philippines and Taiwan. Production in India and China remains unchanged at 152 MMT and 146 MMT, respectively.

Demand Softens Despite High Consumption Levels

Projected global rice consumption in 2025/26, including residual use that takes post-harvest losses into account, the April forecast was cut by 400,000 tonnes to 540.6 million tonnes, mainly due to reduced demand in Japan and Iraq. However, consumption remains strong across major markets such as Bangladesh, Nigeria, Vietnam, and the United States.

Stocks Build Up as Trade Faces Pressure

Global ending stocks are projected at 192.3 MMT, with China and India holding the largest share due to government stockholding programs.

Global rice trade is expected to reach a record 62.1 MMT in 2026, though slightly revised downward due to weaker exports from Pakistan and the United States amid rising competition from lower-priced suppliers.

Mixed Price Trends Across Origins

Export price trends remain mixed. Prices increased in Thailand and Vietnam, with Thailand's 100% Grade B white rice rising to $388/ton and Vietnam's 5% broken rice at $380/ton. In contrast, India and Pakistan witnessed price declines due to competitive pressures.

Domestic Production Faces Structural Challenges

Thailand's 2025/26 main-season rice production is projected at 26.9 MMT over 9.8 million hectares, with planted area declining due to lower farmgate prices and shifts toward more profitable crops such as sugarcane. While yields may improve slightly due to adequate water availability, flooding in key northern regions has limited gains.

Outlook: Competition and Quality to Shape the Market

The global rice market with ample supplies likely to keep prices range-bound. For Thailand, export competitiveness will depend on pricing strategies against lower-cost origins like India and Pakistan.

While premium segments such as Hom Mali rice may support value realization, overall export growth could face headwinds from subdued demand in Africa and the Middle East. In the medium term, Thailand is expected to focus more on quality-driven and value-added rice exports as global competition intensifies.