INTERVIEW: Singapore rice supply stable amid global price swings: importers association

Singapore's rice market has remained resilient amid global price volatility due to a robust national stockpile scheme and a diversified import strategy, Andrew Tan, chairman of the Singapore General Rice Importers Association, told Platts.

"Most of our rice comes from Thailand and Vietnam -- about 80% to 90%. The rest is from India, Japan, Pakistan and Myanmar," Tan said, adding that the dominance of Thai and Vietnamese rice reflects the taste preferences of the city-state's largely ethnic Chinese population.

Singaporeans primarily consume Hom Mali rice from Thailand and Jasmine rice from Vietnam, with white rice forming a small part of the domestic market. "Fragrant rice is the clear preference here," Tan said.

Although Thai Hom Mali prices have risen in recent months due to increased demand and limited availability, importers in Singapore have remained calm, buoyed by the appreciation of the Singaporean dollar against the US dollar and a strong harvest in Thailand. "We do not see major sentiment shifts," Tan said. "Also, US demand is expected to slow after the 90-day tariff pause ends, which could help stabilize prices."

Platts, part of S&P Global Commodity Insights, assessed Thai Hom Mali 100% Grade B at $1,084/mt FOB FCL on May 28, rising $44/mt week over week.

Singapore distinguishes itself in navigating global volatility through its Rice Stockpile Scheme, or RSS, which mandates that importers maintain a strategic inventory.

"For every 1,000 mt we sell in the market, we are currently required to hold 3,000 mt in government-designated warehouses," Tan said. "From September, this requirement will rise to 3,500 mt."

This system enables importers to rotate their stock and limit the impact of price spikes by releasing rice from the stockpile. "If Thai rice becomes too expensive, we buy Vietnamese rice and sell Thai rice from our stock," Tan said. "It ensures both supply security and price stability."

However, the increasing capital requirement to maintain these stockpiles presents challenges.

"We need more money to hold rice and pay rent for the warehouses. It is not easy when the rice market is so volatile," he said, without specifying how much the capital requirements have increased over a period.

Price fluctuations

Singaporean traders typically favor spot trades and short-term contracts. "We usually do monthlong deals. Long-term contracts do not suit this market due to the frequent price fluctuations," Tan said.

Rice prices often fluctuate due to country-specific trade policies. In the past, India's export restrictions have had ripple effects on global rice prices, affecting countries such as Singapore.

"India is a key global supplier. If white rice prices go up, it eventually pushes fragrant rice prices up as well. It affects us too, in one way or another," he said.

Tan expressed skepticism about the practice of physical indexation for rice, where market participants base their contracts on a physical market price.

"I do not think everyone will adopt it. In rice, trust is a big issue -- there is too much blending going on. It is hard to standardize when the product itself can be inconsistent."

Buyers and sellers use physical indexation to determine the transaction price by averaging a benchmark price over a designated period, instead of agreeing on a fixed price in advance. A premium or discount, known as the basis, is then added to account for factors such as quality, location, logistics or other costs.

According to the US Department of Agriculture Foreign Agricultural Service, Vietnam is expected to export 7.9 million mt of rice in the 2025-26 marketing year (January-December), while Thailand's exports are projected to reach 7.2 million mt during the same period.

The Foreign Agricultural Service projects that Singapore's rice imports will rise 4.5% year over year to 575,000 mt in MY 2025-26 (August-July).