From China to the USA and the EU production rice decreases, causing prices to rise, affecting more than 3.5 billion people worldwide. The hit is especially hard for people in Asia and the Pacific, where 90% of the world’s rice is consumed.

According to Fitch Solutions, the global rice market will face its biggest deficit in over two decades this year. This shortage will hit countries that import large amounts of rice.

“Globally, the most visible impact of the global rice shortage has been and continues to be the highest rice prices in a decade,” said Charles Hart, commodities analyst at Fitch Solutions, according to CNBC.

Rice prices will remain at their current high levels until 2024, according to a Fitch Solutions report.

The report says that the price of rice averaged $17.30/cwt in 2023 and will fall to $14.50/cwt in 2024. CVT (hundred = 50 kilograms) is a unit of measure for some foods, such as rice.

As rice is a staple food in many markets in Asia, prices are an important determinant of inflation and food security, especially for poorer households.

deficit

The global market deficit for 2022/2023 is projected at 8.7 million tons. This is the biggest shortage of rice since 2003/2004, when the world market was short of 18.6 million tons.

The rice shortage is a result of the ongoing war in Ukraine, as well as bad weather in rice-producing countries such as China and Pakistan.

In the second half of last year, farmlands in the world’s largest rice producer, China, were hit by heavy summer rains and flooding.

Similarly, in Pakistan, which produces 7.6% of the world’s traded rice, annual output fell 31% due to severe flooding last year.