Global rice production falling, says Fitch Solutions


Rice output is declining from China to the United States to the European Union, raising costs for more than 3.5 billion people worldwide, notably in Asia-Pacific, which consumes 90% of the world’s rice.

According to Fitch Solutions, the global rice market would see its greatest shortage in two decades in 2023.

Analysts told CNBC that a shortfall of this scale for one of the world’s most cultivated cereals will impact major importers.

“At the global level, the most evident impact of the global rice deficit has been, and still is, decade-high rice prices,” Fitch Solutions’ commodities analyst Charles Hart said.

Rice prices are anticipated to remain near current highs through 2024, according to an April 4 analysis by Fitch Solutions Country Risk & Industry Research.

According to the analysis, rice prices have averaged $17.30 per cwt year to date through 2023, and will only fall to $14.50 per cwt in 2024. Cwt is a weight unit used to measure certain commodities such as rice.

“Given that rice is the staple food commodity across multiple markets in Asia, prices are a major determinant of food price inflation and food security, particularly for the poorest households,” Hart said.

According to the research, the global gap for 2022/2023 will be 8.7 million tonnes.

According to Hart, this would be the highest global rice shortfall since 2003/2004, when global rice markets generated a deficit of 18.6 million tonnes.

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