SE Asia exporters see profit margins shrink.

FE Team

Rice markets across Asia are facing mounting cost pressures as rising local fuel prices and shortages — triggered by the ongoing Middle East conflict — drive up expenses, multiple Asia-based market sources told Platts, part of S&P Global Energy.
While weak international demand continues to weigh on FOB offers, rising local costs across major exporting origins are making it harder for buyers to commit and are adding uncertainty to regional rice trade, the sources said last week, reports spglobal.com.

Asian rice markets are facing two main issues; rising costs, driven by surging fuel prices, are pushing up transportation costs, while weak international demand for white rice is weighing on prices. This mix is creating a fragmented and uncertain market.
Platts assessed India 5% white rice at $337/metric ton FOB on March 12, down $3/mt month over month, Pakistan 5% white rice at $346/mt FOB, down $18/mt month over month, and Thailand 5% white rice at $364/mt FOB, down $15/mt over the same period.
Platts assessed Vietnam 5% white rice at $348/mt FOB March 6, unchanged month over month, and Myanmar 5% white rice at $349/mt FOB FCL, up $1/mt over the same period.
In India, rising transport and packaging material costs are outweighing any FOB price softening from weak demand, several market sources said, while others believe FOB prices will have only a limited impact.
“FOB prices will have little impact [from] the rise in the cost of transport and packing material. Rupee depreciation will compensate [FOB prices] a bit, but CIF costs will definitely rise due to higher insurance and freight [rates],” a Singapore trader based in India said, adding that sellers who have committed to CIF contracts are likely to renegotiate terms, as war surcharges are passed on to buyers.
Pakistan’s market is also pressured, with fuel costs rising sharply and local transportation affected. Sentiment is mixed; some sources expect local prices to keep rising, while others anticipate stabilization in coming days.
“Petrol prices have been raised by almost 35% since Saturday [March 7]. There are no shortages yet, as higher prices mean people can’t afford to hoard,” a local exporter said, adding that authorities have raised prices to curb panic-buying.
Rice exporters in Vietnam, Myanmar and Cambodia said they are also seeing mounting cost pressures as fuel and input prices rise, eroding profit margins.
“Fuel prices have surged recently, leading to higher transportation costs for rice and other goods,” said a Ho Chi Minh City-based exporter, observing increases of Dong 3,000-5,000/liter in domestic fuel costs, with further rises expected. The cost of empty bags has also climbed by 15%-20% due to higher plastic prices, further adding pressure on exporters, the exporter added.
In Myanmar, fuel shortages have led the government to impose an odd-even vehicle rule for private cars. Despite supply constraints, sellers said domestic rice prices have remained largely stable so far.
“Freight rates and bunker prices are up, so offtake will be impacted. Prices may soften a bit; however, fertilizer prices have also increased, and I believe this will eventually affect rice prices — if not immediately, then possibly in the near future,” a Yangon-based trader said.
Cambodian exporters are facing similar pressure from higher logistics costs.
“Local transportation costs are rising. As fuel prices go up, trucking fees also increase, so prices must rise to keep up with these costs,” a Phnom Penh exporter said.

Published Date: March 16, 2026