Thailand's rice exports face Middle East disruption, ASEAN demand emerges as key support

• Weather conditions critical for sustaining supply
  
  
• Exports drop 4% y-o-y to 1.15 mnt in Jan-Feb'26
  
  

Thailand's rice export market has come under pressure in early 2026, with shipments declining amid intensifying competition from India and Vietnam, coupled with logistical disruptions in key Middle Eastern trade routes. At the same time, evolving regional demand dynamics and favourable off-season crop conditions are reshaping the country's supply outlook.

Thailand's rice production system is structured around two distinct cropping cycles. The main season, spanning May to October, is monsoon-driven and accounts for the majority of cultivation, contributing approximately 80-82% of total rice acreage. The off-season crop, grown during the November to April dry period, relies on irrigation and contributes the remaining 18-20% of total area, playing a supplementary role in overall supply.

Export slowdown amid geopolitical disruptions

According to Thai Customs Department data, rice exports during January-February 2026 declined to 1.15 million metric tonnes (mnt), down 4% y-o-y from 1.20 mnt in the same period last year. The slowdown intensified in March, particularly for shipments to the Middle East, following the closure of the Strait of Hormuz.

The disruption has had a significant impact on Thailand's export competitiveness. War-risk insurance premiums surged by as much as 40%, sharply increasing freight costs and compressing exporter margins. In a worst-case scenario, authorities have indicated that a substantial portion of Thailand's Middle East-bound exports could be at risk.

The Middle East remains a critical market, accounting for approximately 1.3 mnt or 17% of Thailand's total rice exports in 2025, with Iraq and Yemen as key destinations. Any prolonged disruption in this region is therefore expected to weigh on overall export performance.

ASEAN demand gains strategic importance

As Middle Eastern demand faces constraints, Southeast Asia is emerging as a key alternative market. Countries such as the Philippines and Indonesia continue to experience structural supply gaps, particularly for white rice, sustaining import demand.

In addition, the regional push toward diversifying sourcing away from single-origin dependence is creating opportunities for Thailand to strengthen its market share. Shorter shipping distances within ASEAN also provide a logistical advantage, shielding trade flows from disruptions affecting longer routes and helping maintain competitiveness.

Off-season crop conditions remain supportive

On the supply side, Thailand's MY 2025/26 off-season crop is progressing under broadly favorable conditions. As of mid-April 2026, planting area reached 16.3 million rai (2.6 million hectares), significantly higher than 13.6 million rai (2.2 million hectares) in the same period last year and equivalent to 112% of the seasonal target.

Water availability has supported planting activity, with the four major reservoirs in the Chao Phraya Basin at 47% capacity, above last year's levels. However, nationwide reservoir levels remain below 30% capacity, indicating uneven water distribution across regions.

Weather developments remain a key watchpoint. While recent summer storms may provide some relief, the Thai Meteorological Department has forecast hotter and drier-than-normal conditions through mid-May, raising concerns over moisture availability, particularly in non-irrigated areas ahead of the main crop season.

Outlook

Thailand's rice export outlook in 2026 will be shaped by a combination of geopolitical disruptions and regional demand shifts. While Middle East trade flows remain vulnerable to logistical constraints and elevated costs, rising demand from ASEAN markets is expected to provide partial support.

On the production side, a strong off-season crop and adequate irrigation in key regions underpin near-term supply stability. However, weather risks associated with a hotter and drier summer could influence main-season planting prospects, making monsoon performance a critical factor in determining overall output.

In the near term, Thailand's rice sector is likely to navigate a mixed environment, where export challenges persist but regional demand and stable supply conditions help cushion the downside.