Vietnam rice exports under pressure amid weak demand, falling production

• Lower production and weak demand from Philippines and Indonesia are pressuring Vietnam's exports
  
  
• Export challenges and a shift to premium varieties persist
  
  

Vietnam, one of the world's leading rice exporters, is witnessing a slowdown in export volumes and price realisation, reflecting a broader shift in global demand dynamics. This transition is significant for global rice balance, as Vietnam's export performance often serves as a key indicator of international market sentiment.

Weak demand weighs on exports and prices

Vietnam's rice exports are projected to decline to 7.6 MMT in MY 2026/27, continuing a downward trend from 8.07 MMT in MY 2024/25. Export values fell to $4.1 billion in marketing year (MY) 2024/25, a decrease of about 28 percent compared with MY 2023/24. Post expects this downward trend to continue.

A major driver of this decline is the import policy shift in the Philippines, which accounts for around 40% of Vietnam's exports. The country's temporary suspension of rice imports in late 2025 significantly reduced demand. Similarly, imports by Indonesia dropped sharply, while demand from Malaysia and Singapore softened.

Although exports to China and African markets increased, they were insufficient to offset the overall decline. As a result, average export prices fell to around $428/ton in 2025, nearly 28% lower compared to 2024.

Production pressures and structural shift

Domestic challenges have added further pressure. Paddy prices in MY25 declined by nearly 26% y-o-y compared to MY24 , particularly during peak harvest months, compressing farmer margins. At the same time, rising input costsespecially fuel and fertilizershave discouraged cultivation.

Rice area is projected to decline to 6.71 million hectares, with production estimated at 2.61 MMT, continuing a gradual downtrend. Farmers are increasingly shifting toward more profitable alternatives such as aquaculture and high-value crops.

Within the rice segment, however, a structural shift is underway. Farmers are moving toward higher-quality and fragrant rice varieties, supported by better price realization. The share of fragrant rice exports has increased from 16% to 24%, indicating a move toward value over volume.

Consumption and stocks

Vietnam's total rice consumption is expected to rise modestly to 22.85 MMT, supported by population growth and increased demand for processed rice products. However, per capita consumption continues to decline due to changing dietary patterns.

With exports slowing and production still relatively stable, rice stocks have increased to 2.66 MMT, reflecting weak market absorption. The government has stepped in to accelerate procurement and expand storage to stabilize domestic prices.

Outlook

The global rice market is transitioning from a supply-driven to a demand-sensitive phase, with increasing self-sufficiency among importing countries likely to keep demand subdued in the near term.

For exporters like Vietnam, this implies intensifying competition and a continued focus on premium segments. In the medium term, trade growth may moderate, with prices increasingly influenced by policy decisions rather than supply shocks.