Thai rice market eyes fresh crop as supply, demand, weather weigh on trade

Thailand's rice market is set for fresh second-crop arrivals from late July, although exporters remain divided over whether additional supply would weigh on prices, amid some short covering, returning demand and weather uncertainty, which continue to influence sentiment.

Market participants expect additional supplies to become available from late July. However, the extent of any price decline remains uncertain. Some exporters expect fresh arrivals to exert pressure on prices, while others believe tighter nearby supplies and renewed buying interest could continue to support the market.

Platts, part of S&P Global Energy, assessed the price of Thai 5% white rice at $483/metric ton FOB on June 25, up $9/mt week over week and $34/mt month over month.

A Thailand-based exporter said prices typically decline once fresh supplies arrive, but the market remains difficult to predict.

"In theory, prices should ease once the new crop arrives, but anything can happen," the exporter said. Renewed buying interest from Malaysia, the Philippines and Iraq, along with exporter short covering, could continue to support prices in the near term, according to the exporter.

Thailand exported about 1 million mt of rice to Iraq, 277,799 mt to Malaysia and 186,415 mt to the Philippines in 2025, according to S&P Global Energy data.

In the first four months of 2026, Iraq imported 91,865 mt from Thailand, while the Philippines imported 126,644 mt, equivalent to 68% of its 2025 imports, and Malaysia imported 182,036 mt, or 66% of its 2025 total.

Production concerns

Market participants expressed mixed views on the potential impact of below-average rainfall on the upcoming crop.

The Thailand-based exporter said localized water shortages may not materially affect the country's overall production. "I think it has some impact on certain areas, but not significantly on the overall supply," the exporter said. "The current crop situation in Thailand is still not at a level where supply becomes insufficient."

A second Thailand-based exporter said the July crop could be relatively small, and that exporters were expected to continue covering earlier sales commitments. The Philippines remained the primary active buyer at current price levels, while demand from other destinations was limited, according to the exporter.

Rainfall during the coming months would play a crucial role in production prospects. "Water is most important. If there is no water, the supply will be severely affected," the second exporter said. "Right now, rainfall is below average. However, the rainy season continues through October, so we will see."

A third Thailand-based exporter expected fresh arrivals to impact prices, although the extent of the decline would depend on demand.

"Yes, I hope the price will go down a bit. We will have to see whether demand still continues," the exporter said, adding that buying interest could reemerge if Thai prices fall to about $440-$450/mt FOB.

According to the US Department of Agriculture, Thai rice production is expected to dip 0.7% year over year to 20.7 million mt in marketing year 2025-26 (January-December).

Market participants said the price direction over the coming weeks will largely depend on the pace of fresh supplies reaching the export market, whether demand from key Asian and Middle Eastern buyers strengthens, and whether rainfall improves enough to alleviate concerns over crop development.