Rice soars to highest since 2008 on rising threats to supply

Rice prices soared to the highest in almost 15 years in Asia on mounting concerns over global supplies as dry weather threatens production in Thailand and after top shipper India banned some exports.

Thai white rice 5% broken, an Asian benchmark, jumped to $648 a ton, the most expensive since October 2008, according to data from the Thai Rice Exporters Association on Wednesday. That brings the increase in prices to almost 50% in the past year.

Rice is vital to the diets of billions of people in Asia and Africa, and the surge in prices could add to inflationary pressures and boost import bills for buyers.

The latest threat to supply comes from Thailand, the second-biggest shipper. Authorities are encouraging farmers to switch to crops that need less water as the nation braces for drier conditions with the onset of El Niño.

Cumulative rainfall in the key central growing region is 40% below normal, and the move to curb planting is to conserve water for households. The government previously asked growers to reap only one crop this year.

Last month, India widened its shipment ban to protect domestic supplies, spurring panic buying in some countries. The curbs exacerbated worries over a global shortage amid growing world consumption.

The price surge will aggravate stresses in global food markets that have been rocked by wild weather and reduced grain supplies from the Black Sea region because of Russia's war in Ukraine.