Thailand’s rice prices have increased by over 15 per cent in the past four months, even as the cereal’s rates in India continue to languish at multi-year lows.
Thai rice is currently enjoying over $75 a tonne premium over Indian rice on hopes of a deal with China buying more, said trade sources.
Data available from the Thai Rice Exporters Association (TREA) showed that while prices of Thailand’s 5 per cent broken white rice have increased to $430 a tonne from $370 during end of August, Indian rates for the same variety are quoted at $354 against $377 in the same period, down 6 per cent.
Usual premium
Indian rice prices are lower despite exports increasing in the first half of the current fiscal to 8.28 million tonnes (mt), valued at $3.37 billion. During the same period last year, shipments totalled 5.77 million tonnes, valued at $2.79 billion, according to data from the Agricultural and Processed Food Products Export Development Authority (APEDA).
Thailand’s rice exports have declined by 24 per cent in volume and 36 per cent in value during January-October this year to 6.42 mt valued at $3.74 billion compared with 8.44 mt valued at $5.64 billion.
Usually, Thai rice enjoys a $15-20 a tonne premium, besides another $15 accounts for logistics. However, it is enjoying an additional premium of over $30 in view of a deal that Bangkok is working on with Beijing for a government-to-government (G2G) deal.
Record output, stocks
Indian rice prices are ruling low as the Food Corporation of India (FCI) holds 31.19 mt of rice and 39.38 mt of paddy ( 26.38 mt of rice when processed). The country is expected to produce a record high of over 151 million tonnes of rice this year, further putting pressure on prices.
However, local reports in Bangkok said Thai rice prices have increased by $30 a tonne recently, and the trade feared whether China would agree on the price at which the rice is offered. When the negotiations began, the rice was trading below $400.
Another issue that is proving to be tricky in finalising an initially 100,000-tonne contract to be executed between January and March 2026 is the Thai baht’s rise against the US dollar. Traders say for every 1 baht rise in the Thai currency, rice prices tend to increase by $15 a tonne.
Easier quota access
A New Delhi-based trade analyst said Thai rice prices are enjoying a premium as the country has easier quota access with China, despite Indian prices being cheaper.
“Indian rice approvals are more limited and variety-specific. When Indian 5 per cent white rice is $80–100/tonne cheaper, China still buys from Thailand for structural, policy, and quality reasons. Thai 5 per cent white rice quality fits southern and coastal Chinese consumption habits, while there are a few gaps in the Indian rice quality,” the analyst said.
China’s rice imports from Thailand have zig-zagged over the past few years. After importing 7.7 lakh tonnes in 2022, it bought only 4.6 lakh tonnes and 4.3 lakh tonnes in 2023 and 2024, respectively. Shipments into the Communist country are expected to be 7.5 lakh tonnes in 2025.
Chinese urgency
China, on the other hand, imported a total of 26 lakh tonnes of rice in 2023, 16 lakh tonnes in 2024 and 18 lakh tonnes so far in 2025
For China, the internal haulage cost between Thailand and local supply centres is the key. Also, China deliberately avoids over-reliance on one origin, especially India, he said.
China’s urgency to buy Thai rice despite it being priced higher could be because there is an urgency on Beijing’s part, as its stocks have to be replenished. “China think supplies may tighten going forward, and it wants to lock its requirement at the current rate before any weather risk,” the analyst said.
Indian rice could also rise if China turns to New Delhi. But any rise in domestic rice price could lead to the government curbing shipments, and Beijing could lose its cheaper supply option.
Hedging strategy
China could avoid Indian rice, also because it prefers food security in Africa, which depends on New Delhi for its supplies. “On its part, China will use Thailand for controlled and strategic buying and thus keep Indian prices lower for future use,” the analyst said.
Besides, Chinese imports are to manage domestic prices, stocks, and geopolitics. “For China, buying from Thailand is a strategy to hedge its risk rather than to control prices,” the analyst said.
Apart from Thailand, China could import 20 lakh tonnes of rice from Vietnam and Myanmar through cross-border trade that may not be recorded by the Customs authorities, traders said.
Published on December 26, 2025