DR. ALVARO DURAND-MORAT / FAYETTVILLE, ARKANSAS
As the 2025/26 rice season approaches, it is important to assess market fundamentals to anticipate challenges and position the U.S. long-grain rice sector for the year ahead.
Globally, the rice market remains supply-dominated, a trend expected to continue into 2025/26. This outlook is largely driven by India’s strong production, which continues to generate sizable export surpluses, and by increased output in Indonesia, which is expected to reduce its import needs. As a result, international prices are projected to remain under pressure. Thai long-grain 5% rice prices are forecast to average between US$350 and US$370 per metric ton in 2025/26. While U.S. long-grain rice typically sells at a premium to Thai rice, export prices are expected to decline from 2025 levels due to intensified competition from Mercosur exporters, particularly in core markets such as Mexico and Central America. Despite these pressures, exports remain vital for the U.S. long-grain sector. In 2024/25, exports reached 60.8 million cwt, and although volumes have trended lower over the past decade, roughly 40% of U.S. long-grain production is still exported annually.
On the domestic front, the most significant challenge comes from the rapid growth of rice imports, primarily aromatic jasmine and basmati rice, which increasingly displace domestic long-grain rice. Over the past decade, imports have grown at an average annual rate of 7% and reached 43 million cwt in 2024/25, accounting for 32% of domestic demand. Current trends suggest continued growth, raising the possibility that the United States could become a net importer of long-grain rice, including aromatic varieties, by the middle of the next decade.
Given these global and domestic dynamics, the U.S. long-grain rice sector faces difficult choices. In the short term, options are limited but critical. At the farm level, reducing production costs per unit of output is essential in the current low-price environment. Continued investment in export market development is also important, particularly efforts aimed at diversifying destinations to improve price stability and reduce risk. Additionally, changes in production and post-production practices could enhance competitiveness relative to imports. While expanding domestic aromatic rice production represents a niche opportunity, broader gains may come from strategies such as varietal identity preservation and targeted marketing to deliver high-quality U.S. long-grain rice with appearance and cooking characteristics comparable to imported aromatics.
Over the longer term, rice quality stands out as a key strategic lever. Because quality is defined differently across markets, the U.S. industry must carefully identify and develop quality profiles that best support sustainable growth and long-term competitiveness. ∆
DR. ALVARO DURAND-MORAT / UNIVERSITY OF ARKANSAS