International Trade: Politics Get in the Way

The United States is a net exporter of rice, sending abroad 3.4 million MT in 2021 while importing 957,000 MT. The majority (544,000 MT) of rice imported to the United States in 2021 originated in Thailand. The top five recipients of exported U.S. rice (Mexico, Haiti, Japan, Canada, and Honduras) have taken more than half of all exported U.S. rice (between 53% and 59% annually), over the past five years.

Figure 2: Top Five Recipients of U.S. Rice by Volume (MT), 2017-2021

Figure 2: Top Five Recipients of U.S. Rice by Volume (MT), 2017-2021
Source: UN Comtrade

Notably, the second largest recipient of U.S. rice over the past five years is Haiti, which is a country experiencing political destabilization. According to the USDA, Haiti exhibited a slower-than-expected pace of rice purchase from the U.S. in 2022 due to its political instability. U.S. rice is the predominant rice consumed in Haiti, and rice overall was estimated to account for 23% of the daily caloric intake of the average Haitian in 2011. 

The complication of Haiti as an export destination follows year-over-year decline in both rough and milled rice exports, which is expected to continue into 2023.

Figure 3: U.S. Milled Rice Exports (million tons)2

Figure 3: U.S. Milled Rice Exports (million tons)
Source: USDA ERS Rice Outlook

Domestic Weather Compounds Basis Risk

The Mississippi River water level sunk to levels not observed in three decades this past October, choking trade flow for a myriad of agricultural commodities making their way from the Midwestern and Southern United States to the Gulf of Mexico. In many spots, the river was not deep enough for commercial traffic, prompting emergency dredging by the U.S. Army Corps of Engineers, and barges grounded on sandbars with unprecedented frequency. The situation sent shipping prices skyrocketing, with the amount of goods a barge can carry halved in many cases. Additionally, drought and water shortages plague the current crop in California (where the short-grain Japonica varietal is grown). The figure below shows the reported USDA daily spot price for No. 2 medium-grain rice in California and Arkansas rising dramatically in Q4 2022, continuing an upward trajectory throughout the year.

Figure 4: USDA No 2. Medium Grain Rice Spot ($/cwt), California and Arkansas

Figure 4: USDA No 2. Medium Grain Rice Spot ($/cwt), California and Arkansas
Source: Bloomberg

Complicated transport on the Mississippi River compounds the bullish trend in Rough Rice futures caused by low domestic production and high input costs. Local basis fell along with the water level, as riverside elevators were unable to move grain. Elevators routinely turned away producers looking to sell in October, unable to sustain more supply in their facilities. Cash prices fell, with local supply in unfortunate abundance, while global supply faltered from the bottleneck, weakening basis along the Mississippi River. Thankfully, the river has risen in recent weeks, rebounding the cash price as elevators welcome grain, strengthening basis.

Rice: Timeless and Resilient

Global rice consumption Is projected to rise in the coming decade by 1.1% annually to 2031, according to the United Nations Food and Agriculture Organization. The majority of increasing consumption is attributable to rising populations in Asia, plus Africa increasing per capita consumption. 

Because rice is a relatively adaptable crop, it is grown in areas of the U.S. susceptible to extreme weather, though production can vary significantly due to climate risk and acreage losses. Relative prices for soybeans, which compete for acreage in many areas, influence planting decisions. Additionally, rice is vulnerable to supply chain uncertainty, as the Mississippi River transport strangle of 2022 has demonstrated. As for decades, CBOT Rough Rice futures remain the ideal vehicle with which to hedge long-grain rough rice price risk in the Americas. Lean more at www.cmegroup.com/agriculture.


1 - Rough Equivalent of Rough and Milled Rice
2 - Source: USDA, Economic Research Service, Rice Yearbook dataset; 2000/01–2019/20; USDA, World Agricultural Outlook Board, World Agricultural Supply and Demand Estimates, 2020/21–2022/23.


All examples in this report are hypothetical interpretations of situations and are used for explanation purposes only. The views in this report reflect solely those of the author and not necessarily those of CME Group or its affiliated institutions. This report and the information herein should not be considered investment advice or the results of actual market experience.

CME Group is the world’s leading derivatives marketplace. The company is comprised of four Designated Contract Markets (DCMs). 
Further information on each exchange's rules and product listings can be found by clicking on the links to CME, CBOT, NYMEX and COMEX.

© 2025 CME Group Inc. All rights reserved.