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Rice as commodity

Cultivating rice is the – and source of income – for millions of households around the globe. Rice is grown in more than a hundred countries, with a total harvested area of approximately 158 million hectares, producing more than 700 million tons annually (470 million tons of milled rice). Several countries of Asia and Africa are highly dependent on it as a source of foreign exchange earnings and government revenue.

rice-as-commodity

International rice market/trade

Rice is the staple food of more than half of the world’s population, with more than 700 million tons produced annually (equivalent to 470 million tons of milled rice). Although most rice is consumed in the countries where it is produced, a growing demand in some areas is feeding the international rice trade.

Most of the rice is grown and consumed in Asia, from Pakistan in the west to Japan in the east. ‘Rice-producing Asia’ – defined as Asia excluding Mongolia and the countriesof Central Asia – accounts for roughly 90% of world rice production. But because it is a net exporter of rice to the rest of the world, its current share in global rice consumption is slightly less (87%).

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National rice markets

The price of rice is a key variable for farmers, consumers, and governments in most of Asia, and in many other parts of the world. Although the world market price of rice has declined over time, domestic prices are more relevant for farmers and consumers.

There is wide variability in the domestic price of rice among different countries, with some countries – Japan, Korea, Turkmenistan, and Brunei – having extraordinarily high domestic prices that are at least seven times the median price of $239 per ton. Higher GDP per capita and higher proportions of imports in domestic consumption are both associated with higher domestic prices.

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Non-edible rice products

Each year, hundreds of millions of tons of rice straw and husks are produced. These rice residues generally have little or no commercial value. Burning of rice residues causes severe air pollution in some regions, but incorporation into the soil is a major source of methane emissions from rice fields. Innovative uses of rice straw and husks may generate new income opportunities for the rice-farming sector and help to mitigate the effects of climate change.

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If you want to learn more, please read the Rice Almanac. You can purchase it on Kindle or download for free as a PDF.

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