Asia rice ımports and consumption rise as wheat prices remain high

24 February 20232 min reading

Sustained high wheat prices are reversing trends of greater consumption of wheat for some countries in Asia and resulting in a shift back towards rice. The Philippines and Bangladesh exemplify this trend, with both governments spurring rice imports with reduced tariff levels.

The Philippines is a major rice producing country but has also been the second largest rice importer since 2020. In June 2022, to battle high domestic prices, the Philippines lowered tariff rates to 35 percent for both in- and out-of-quota rice until the end of December 2022. The policy was then extended through the end of 2023. With a modest decline in production expected, Philippines imports are forecast at a record 3.6 million tons for marketing year 2022/23, with consumption forecast to rise more than 2 percent. This contrasts with a contraction of nearly 9 percent for wheat milled for human consumption.

Previously, Philippines rice imports faced a 40 percent in-quota rate and a 50 percent out-of-quota rate. However, members of the Association of Southeast Asian Nations (ASEAN) only face a 35- percent tariff for both in and out of quota imports. With this advantage, Vietnam, a member of ASEAN, is by far the largest supplier to the Philippines. The current policy has lowered the most favored nation (MFN) tariff to 35 percent for all origins. Other suppliers include Thailand and Burma. Despite much lower prices than competitors, India rice exports to the Philippines are virtually nil.

However, India continues to supply rice to its neighbor Bangladesh. India is benefiting from strong import demand from Bangladesh, where the government is likewise encouraging increased rice imports to offset lower wheat imports. USDA raised the forecast for Bangladesh rice imports 250,000 tons in February while wheat imports are cut 700,000 tons for 2022/23. Bangladesh is a major producer of rice but has required large imports again this year as the population shifts away from a multi-year trend of increasing wheat consumption. Wheat prices have nearly doubled over the past year as trade with Ukraine and India has been disrupted, resulting in a year-over-year decline in wheat consumption. With the extension of lower import tariffs for rice, Bangladesh has moderated the impact of food price inflation.


Articles in News Category
11 September 20203 min reading

PEMA Partners with Kansas State University’s Bulk Solids Innovation Center

The Process Equipment Manufacturers’ Association (PEMA) and the Bulk Solids Innovation Center (BS...

16 December 20222 min reading

General Mills named No. 2 on Newsweek's America's Most Responsible Companies List

General Mills has been recognized by Newsweek as one of America’s Most Responsible Companies, ranking No. 2 overall and No.1 in the Consumer Goods industry.