Commodities: Rough Rice

Rice was domesticated from a wild grass more than 10,000 years ago. Today, rice is a staple food for billions of people throughout Asia, the Middle East and Latin America; it has fed more people over a longer period of time than any other crop. It’s the third-most produced grain in the world behind only wheat and corn (number one).  

"Rough rice" simply means rice that has been harvested, but not milled.

Contract Specifications

Production

Worldwide, two main types of rice are produced: Japonica and Indica. Japonica rice is typically grown in temperate climates, and the grains are round and strong. When cooked, Japonica is sticky and moist. Indica is grown in hot climates. The grains are long and break easily, and the cooked rice is fluffy and does not stick together. China is the world’s largest rice producer, followed by India, Indonesia, Bangladesh, Vietnam and Thailand.

Price Drivers

Rice is one of the world’s most important crops. Several factors can influence prices, including:

• the growth rate of rice yield (for example, when rice yields increase at a slower pace than population)
• stock levels (inventories)
• demand growth (from rising populations)
• changes in public investment in agricultural research, development and infrastructure
• crude oil prices, which affect production costs
• exchange rate movements
• export restrictions