Asian Rice Prices Surge 20% as War and El Nino Threaten Supply

Asian rice prices have surged by 20% in May 2026 amid growing concerns over global food supply. Rising energy and fertiliser costs, coupled with extreme weather threats from El Niño, are jeopardising production in major rice-producing nations.

Recent data shows white rice prices in Thailand, a key Asian market benchmark, jumped 20% in May — the largest monthly increase since records began in 2008. Futures contracts on the Chicago Board of Trade also rose around 15% during the month.

BMI commodity analysts, part of Fitch Solutions, predict the upward trend will continue. Bin Hui Ong, an analyst, warned that El Niño’s predicted hotter and drier conditions across parts of Asia could further suppress rice production and push prices higher.

Market concerns are well-founded. Since the war erupted in late February, global energy and fertiliser supplies have been disrupted, exacerbated by the near-closure of the Strait of Hormuz, a critical energy trade route.

As a result, Asian farmers reliant on imported fertiliser and fuel face soaring production costs. Rice is a crop requiring substantial fertiliser, and many paddy irrigation systems still use diesel-powered pumps, directly linking energy price hikes to production expenses.

Thailand, Vietnam, and India play crucial roles in the global rice market as major suppliers to importing nations. However, rising costs are forcing some farmers to reduce planting. Tran Van Be Bay, a 60-year-old farmer in Vietnam’s southern Vinh Long province, typically plants three rice crops a year but now plans to cut one season. “With costs continuously rising and the current extreme heat, it’s not the right time to plant new crops,” he said.