Rice Price Drops, Bucking Trend for Grain

June 29, 2022
Rice is one of the few major agricultural commodities whose price has dropped this year, helping retard inflation in Asia.

Rice is one of the few major agricultural commodities whose price has dropped this year, helping retard inflation in Asia.

At mid-June, rice prices were about 17% lower than last year’s. By contrast, wheat is 37% higher and corn 27% higher, according to the Wall Street Journal.

The drop in rice prices is mostly attributable to bumper crops in Asia. In addition, trading in rice is relatively unaffected by the war in Ukraine, which has roiled wheat and other commodity markets.

The rice situation has put Asia in a good position with regard to inflation. Its inflation rate was 4%, less than half of the rate in the U.S. and much of the rest of the world.

There are, however, some problems on the horizon. Rice farmers have to cope with lower prices for their crops, while dealing with rising costs for fertilizer and fuel. Some of them are switching to higher-value crops like corn and soybeans, the Journal reports.

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