As global rice markets fluctuate, both Thailand and Vietnam are navigating significant challenges in their rice export sectors. The recent announcement of a 36% import tariff on Thai rice by the U.S. government has raised alarms among exporters, particularly concerning the competitiveness of Thai Hom Mali rice in international markets. Mr. Chookiat Ophaswongse, Honorary President of the Thai Rice Exporters Association, expressed his concerns, stating that this tariff is much higher than anticipated and could drastically affect Thailand's rice exports. "With the price of Thai Hom Mali rice potentially soaring to $1,400 per ton due to these tariffs, we fear consumers will turn to cheaper alternatives, particularly Vietnamese rice," he noted.
In stark contrast, Vietnamese rice exports are also facing their own set of challenges. According to the Ministry of Agriculture and Rural Development, Vietnam exported 2.2 million tons of rice in the first quarter of 2025, generating a turnover of $1.14 billion. While this marks a 0.6% increase in quantity compared to the same period in 2024, the value has plummeted by 19.7%. The average export price of Vietnamese rice has dropped to approximately $522.1 per ton, a 20.1% decline from the previous year. This decline raises questions about the sustainability of Vietnam's rice market as it contends with falling prices amid shifting demand patterns.
Mr. Chookiat outlined the potential repercussions of the new tariffs on Thai rice, particularly for the U.S. market, which has been a major destination for Thai Hom Mali rice. The anticipated price hike could lead U.S. consumers to opt for Vietnamese fragrant rice, which, while subject to a 46% tariff, remains significantly cheaper at $600 to $700 per ton. He emphasized the importance of immediate action from the Thai government to negotiate with the U.S. to mitigate the impact of these tariffs. "We need to see what the actual effects are before making any decisions, but we hope that the government can assist us in this matter," he said.
In the wake of these developments, Thai rice exporters have already begun to feel the pressure. The volume of Thai Hom Mali rice imported into the U.S. has reportedly decreased, with traders bringing in over 100,000 tons in the past two months alone. The fear is that if the tariffs remain, the U.S. market could become increasingly inaccessible for Thai rice.
Meanwhile, the Vietnamese rice sector is not without its own obstacles. The Vietnam Food Association (VFA) reported that despite a slight increase in the price of 5% broken rice, it still remains lower than Thai rice and only marginally higher than Indian and Pakistani rice. This disparity puts Vietnamese rice at a disadvantage, especially as major importers like the Philippines and Indonesia have reduced their purchases in the first quarter of 2025.
Mr. Truong Van Chinh, Director of Chon Chinh Import Export Company, highlighted a more optimistic outlook for his company, which has seen a 15% increase in rice export value compared to the same period last year. This growth is attributed to a focus on high-quality rice exports to diverse markets across Asia, Africa, and Europe. Notably, ST25 rice, a premium variety, is gaining traction in European markets, commanding prices of $1,250 per ton, significantly higher than the same rice sold in China. "Our commitment to quality has allowed us to thrive even amid challenging market conditions," Mr. Chinh stated.
The VFA is urging stakeholders to remain vigilant and responsive to market changes, particularly in light of the global rice price index, which has seen a notable decline. The Food and Agriculture Organization (FAO) reported a 6.8% decrease in the global rice price index in February 2025, indicating a broader trend of falling prices across major rice-exporting countries, including India, Thailand, and Vietnam.
As the Vietnamese rice sector grapples with these challenges, there is a growing focus on enhancing the quality of rice exports. Vietrisa, the Vietnam Rice Industry Association, is spearheading initiatives aimed at developing high-quality rice varieties and establishing a distinctive brand for Vietnamese rice. Mr. Le Thanh Tung, a representative from Vietrisa, emphasized the importance of sustainable practices in rice production, stating that the association is committed to a project aimed at developing high-quality rice in a sustainable manner across one million hectares by 2030. "We aim to create a brand of 'low-carbon Vietnamese rice' that will elevate our products in the global market," he remarked.
With the rice markets in both Thailand and Vietnam facing unprecedented challenges, the future of rice exports in these countries hangs in the balance. The interplay of tariffs, market demand, and production quality will be critical in determining their success in maintaining competitiveness on the global stage. As stakeholders from both nations work to navigate these turbulent waters, the commitment to quality and innovation in rice production will undoubtedly play a pivotal role in shaping the future of their rice industries.
