Food Prices

Japan faced a rice shortage during the summer of 2024, sparking confusion among consumers as supermarket shelves emptied. While low stock levels of rice and tight supply before the October harvest are normal, several factors combined to exacerbate this crisis. Total rice production was normal in 2023, but unseasonable weather reduced the ratio of high-quality rice in overall output.

In July 2023, the Indian government announced export restrictions on non-basmati white rice. Coming after earlier export limits on other types of rice, the action was taken in part due to a strengthening El Niño that threatened to limit rice production and fuel rising food inflation—a potential political liability for the Modi government as it faced upcoming general elections in spring 2024.

Recent shocks from the COVID-19 pandemic to the ongoing Russia-Ukraine war have disrupted global food and fertilizer supply chains—causing price spikes and increased price volatility—a disastrous combination for many vulnerable consumers around the world.

The FAO Food Price Index rose by nearly 1 percent in May due to increased cereal and dairy prices. It remained 3.4 percent below its May 2023 levels and nearly 25 percent below the peak seen in March 2022.

Recent disruptions in rice production and trade, coupled with adverse weather conditions, have increased global rice prices, impacting food security and economic stability across Asia and the Pacific. Short-term and long-term strategies are needed to ensure a stable, affordable rice supply.

In global food markets, few commodities hold as much significance as rice. It's not just a staple food; it's a lifeline for millions, especially across Asia where it forms up to 70% of daily caloric intake and a significant share of the food price basket in certain economies.