The Grain That Feeds The World Is At Risk Of An Upside Breakout 

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by Tyler Durden
Wednesday, May 15, 2024 - 05:05 PM

Rice is a staple food for over 3.5 billion people worldwide, especially in Asia, Latin America, and Africa. It's grown in over 100 countries, with 90% of the world's rice produced in Asia. We have been tracking the prices of Thai white rice, which surged to 15-year highs in 2023 and has since consolidated at these highs with risks of a further upside breakout. 

According to new data from the Thai Rice Exporters Association, Thai white rice 5% broken, an Asian benchmark, rose nearly 6% to $649 a ton, inching closer and closer to last year's highs. Since early 2022, prices have surged 64%. 

We continue to follow Thai rice prices because rice is a critical staple food for billions of people worldwide. 

Here are some of the risks we've pointed out in the last few years:

The good news is that global food prices measured via the UN's Food and Agriculture Organization print below the 2010 Arab Spring level, an area of risk where high food prices cause social instabilities in third-world countries. However, some of the latest prints show that food inflation could increase. 

If prices do surge from here, let's remind readers of this 2008 headline from The Guardian:

Food inflation is certainly not going away. That's evident in the prices of cocoa, OJ, coffee, beef, and many other items at the supermarket.