Some analysts said that due to India's export restrictions and the impact of El Niño on supply, global rice exports may fall by at least 4% in 2023, while India accounts for nearly 40% of world rice exports. The low rainfall caused by the El Niño phenomenon has also weakened the global rice export prospects in 2024. "

In response to inflation and high domestic food prices, the Indian government has gradually restricted rice exports. In July 2023, the Indian government extended the previous ban on the export of broken rice to include all non-Basmati white rice. This has caused global rice prices to rise to their highest level in more than a decade. The implementation of a minimum price for Indian fragrant rice exports last week and an increase in export duties on steamed rice exports could further push up global rice prices.

Despite fears that other rice exporters will follow India's export restrictions, so far only Myanmar has imposed a 45-day temporary export ban. Other exporters, such as Thailand, Vietnam and Pakistan, have instead increased their exports as a result of higher prices. However, this is not enough to replace India's cuts.

Although rice accounts for less than 1% of dry bulk cargo, India's export restrictions will put further pressure on already tight global food supplies. Overall, analysts expect global grain shipments to decline by 1.5 to 2.5 percent in 2023.

At present, rice is transported by portable and ultra-portable bulk carriers. Compared with other bulk commodities, rice exports are relatively small, and there are no major importers. Due to the small volume of transportation in most destinations, rice can also be transported in containers.

, according to the US Department of Agriculture (USDA), global rice exports may fall by another 3% in 2024. So far this year, the El Nino weather phenomenon has led to a weaker monsoon season, resulting in less rainfall than usual in southern and African regions. According to the Indian Meteorological Department, rainfall may remain low in September, further threatening the upcoming rice harvest.

Despite the weak outlook for rice exports, global cereal shipments are likely to recover by 3% to 4% in 2024, with increases in shipments of feed grains such as corn and soybeans likely to lead the recovery. On the other hand, tight supplies of food-grade grains such as wheat and rice are likely to continue to fuel inflation.

Source: Shipping Industry