Regional Rice Growers Face Growing Risks Of Price Volatility, Floods, Soft Demand
By Vijian Paramasivam
PHNOM PENH, Dec 3 (Bernama) -- The severe flooding in Southeast Asia, coupled with weak demand and oversupply in the global market may disrupt rice production and consequently affect prices and farmers' incomes this year.
Regional rice growers will face multiple challenges after major rice importers, the Philippines and Indonesia, halted rice procurement to protect their local industries.
“Millions of Indian farmers feel the pressure, though safety nets prevent total collapse. For Thai farmers, low prices and crop losses will be a severe income shock.
“Vietnam has efficient farming but small holdings. Mekong Delta farmers face both low prices and saltwater intrusion, which cuts yields. “Many farmers depend on exports. When global prices fall, they feel it immediately,” Indian Rice Exporters’ Federation Director-General Vinod Kumar Kaul told Bernama from New Delhi.
Rice prices have fallen 35 per cent in one year to their lowest level since 2017, following the lifting of Indian export restrictions in September last year.
According to the federation, India may scale its exports to about 24 to 25 million metric tonnes in 2025 and 2026.
Millions of Southeast Asian farmers strive to maintain the region’s reputation as the world’s rice bowl, contributing about 30 per cent of the global output, according to the World Agroforestry Centre.
"India is still the champion of global rice exporters. Advances in hybrid rice technology and government subsidies will raise rice production of India and also pressure India to export at a low price.
“Truly, it hurts farmers in Southeast Asia rice export countries,” Bangkok-based Thailand Rice Foundation in Royal Patronage Board Member Somporn Isvilanond told Bernama.
He said although the flood had caused damage to many rice areas in the southern region, it is not a major rice-producing zone.
Thailand can maintain its wet rice production at 24 million metric tonnes, similar to last year’s volume.
“It has not significantly affected the country's total rice production. The global rice market does not panic with the region flooded situation,” said Somporn.
Thailand’s Kasikorn Research Centre has projected rice prices to contract for the first time in four years by nearly 10.9 per cent this year due to a surge in output and a rise of over 34 per cent in India’s rice exports.
Southeast Asian rice growers' challenges are twofold. Vietnam, which has taken over Thailand as the world’s second-largest rice exporter, is grappling with seasonal floods and shrinking exports this year.
Vietnam’s largest export market is ASEAN, which procures 60 per cent of the country’s exports.
The Philippines, Vietnam's main importer with about three million metric tonnes, has decided to temporarily halt imports in 2025 to safeguard local farmers, said its Agriculture Department.
Indonesia, another major importer of Vietnamese rice, has also announced it was stopping the imports of rice until the end of the year, as the nation’s rice reserves have reached self-sufficiency level.
“Rice farming incomes depend almost entirely on the price at harvest time. When export prices collapse, farm-gate prices fall even faster than export prices,” said Kaul.
Although Cambodia is not a major player in the global market, its famed premium fragrant jasmine rice is popular internationally.
"Fifty per cent of production is for domestic consumption and the rest, for export. If the international market price goes down, then the paddy price goes down.
“CRF is working with the government bank and local banks to have more loans to buy more paddy from farmers,” Cambodian Rice Federation (CRF) Secretary-General Lun Yeng told Bernama.
The government injected additional RM165 million (US$40 million) last month to stabilise rice prices this year and early 2026, reported state media Agence Kampuchea Presse.
Cambodia produces about 13 million metric tonnes of rice annually, half of which is exported.
-- BERNAMA
