China's rice imports set to rise as buyers seek most competitive options

China is likely to increase its rice imports as international white rice prices drop, with India's renewed rice exports boosting market supply amid weak demand, which is expected to reshape China's demand dynamics as buyers seek the most competitive sources for purchasing rice from Asian exporting countries, market sources said April 10.

The Foreign Agricultural Service of the US Department of Agriculture anticipates a 5% year-over-year increase in China's milled rice imports to 2.1 million mt in marketing year 2025-26 (July-June), attributing the rise to "India's removal of its broken rice export ban," which led to "weak demand and ample supply."

China mainly imports broken rice to support its animal feed and ethanol producers. Sources said Chinese buyers also purchase 5% broken white rice, particularly at the beginning of their harvest season, alongside some special rice varieties.

A Chinese market participant said Chinese buyers are expecting to buy more from India, Pakistan and other competitive regions but are waiting for prices to stabilize and possibly fall further.

The market is still adjusting to the renewed dynamics following India's renewal of WR exports, especially broken WR prices.

Impact on major exporting countries

"China's rice imports for [MY] 2024-25 are expected to increase from last year. However, the scale of that demand will likely depend on pricing dynamics and how Indian broken [rice] compares with alternatives from countries like Pakistan, Vietnam, etc. China has traditionally been one of the largest buyers of Indian broken rice, importing over 2 million mt," an Indian exporter said.

Vietnamese exporters shared similar sentiments, with a Vietnam-based source saying, "China demands will be usual...unless Vietnam offers significant price advantage. Currently, all origins are offering low prices, and they will buy brokens from the cheapest source."

Platts, part of S&P Global Commodity Insights, assessed India Long Grain White Rice 100% Broken at $324/mt FOB; Pakistan 100% broken WR at $317/mt FOB, down $140/mt year over year; Vietnam 100% Broken WR at $313/mt FOB, down $136/mt year over year; Thai A1 Super 100% Broken WR at $333/mt FOB, down $121/mt year over year; and Myanmar B1 & B2 Broken WR at $274/mt FOB FCL, down $135/mt year over year in the week ended April 4.

Pakistani sources, another important rice exporter to China, mentioned a lack of significant trade with China so far.

A Karachi-based exporter said, "Currently, there is a lull in demand from China for broken rice, as their current requirements are at levels that Pakistani suppliers cannot meet due to low bidding. Chinese buyers anticipated that prices would decrease significantly following India's reopening, but the prices have not fallen as expected. It remains unclear whether they will raise their bid prices or wait for further declines in offers."

The exporter added that there has been no demand for 5% broken WR, as the current price from China stands at $390/mt CNF, below the FOB cost for Pakistan. As the crop cycle ends in April-May, producing rice of Chinese quality becomes more costly, leading to minimal activity.

Pakistani sources do not anticipate further significant demand from China in the current season amid strict competition from other origins.

"Due to the current decline in prices, if they can acquire Thai WR at very low rates, they are unlikely to purchase from Pakistan. Given the high quality of Thai products, they may choose to go with that option, as they have specific preferences regarding their requirements," another Karachi-based exporter said.

Opportunities for Myanmar, Cambodia

However, origins like Myanmar and Cambodia expect fresh demand from China for specific rice varieties in coming months.

Sources in Myanmar said that although China is increasingly requesting specific rice varieties, there has not been any significant demand for the Burmese B12 broken variety. China typically seeks hard grain varieties like A12 broken.

"Recently, there has been strong interest from Chinese buyers in Sin Thuka rice, a medium-grain Special Emata variety. However, due to supply limitations, our capacity to fulfill large orders...is constrained. Aside from Sin Thuka, Myanmar stands ready to meet China's rice demand fully and competitively with other rice varieties," Myanmar Rice Federation Chairman Ye Min Aung said.

Amid limited stocks in the current season, Cambodian exporters also anticipate increased interest from China for some lower-grade varieties.

A Cambodia-based exporter said China's demand has risen compared with March, anticipating increased purchases. However, the exporter noted that China is primarily interested in the OM 5451 and SRO rice varieties, purchasing only a limited quantity of Jasmine rice.

Another Cambodia-based market participant said, "Since stock is not much at the moment, we don't know Chinese demand ahead. But it looks like China has shown increased interest in lower-grade rice varieties as there have been no inquiries for fragrant (premium) varieties like Phka Malis or SKO."

China's forecast for rice consumption in MY 2025-26 is set at 146 million mt, reflecting an increase of 1 million mt compared with MY 2024-25, the latest USDA figures showed.