In a world where crop prices are climbing, fanning inflation fears, one crucial food staple has slumped this year in Asia – rice. Unlike 2008 when wheat and rice surged to the highest on record, helping spark food riots in some countries, this year they are moving in opposite directions.
Wheat futures in Chicago, a global benchmark, have climbed about 30% since the end of December to the strongest in almost a decade, while rice export prices from Thailand, a regional marker, have slumped 25% to a four-year low.
A severe drought in Canada and parts of the U.S., coupled with dryness in the Black Sea region, have cut wheat supply as global demand expands.
Meanwhile, rains in Thailand, one of the world’s top rice shippers, have boosted production. Output is expected to rise by more than 20% in the country this year after rainfall ended a prolonged drought, said Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association.