Chinese authorities are aggressively rolling out their rice price support policy as prices plummet under harvest pressure. While authorities are stockpiling surplus domestic rice, the high Chinese price is attracting a surge of imported rice from India and Southeast Asia. Meanwhile China is dumping cheap rice in Africa. The price support program, a centerpiece of China's "food security" policy, ultimately results in confusion and fills markets with low-quality products--the opposite of Xi Jinping's exhortation to raise the quality of Chinese products.
As the Fall harvest shifts into high gear, China's communist party "Red Net" news site explained this week that an aggressive roll-out of the Chinese rice price support program is needed to stem a 3-year 11.9% decline in rice prices, especially for long-grain (indica) rice harvested in the Fall.
Between October 14 and 20 six of China's rice-producing provinces launched government-backed price support purchases for Fall-harvested long grain rice--the earliest start and broadest scope for such interventions since 2020. This follows the summer roll-out of price support programs that stockpiled early-season indica rice.
Average procurement prices posted by China's food and commodity reserves administration show that the average price of long grain paddy rice was RMB 2,545 per metric ton on October 20, well below the minimum of RMB 2,580 per metric ton. Their reported average long grain rice price has been below the minimum price since July, before harvest and procurement ramped up this month (the peak rice procurement season runs from October to January). On October 20, the lowest average price was RMB 2,427 in Henan Province, while reported average prices were also below the minimum in Jiangxi, Anhui, and Hubei. Hubei, Hunan, Henan, Anhui, Jiangsu, and Jiangxi Provinces launched minimum price purchasing for indica rice. The program has not been activated in other provinces where prices exceeded RMB 3000 in Guangdong and Guangxi.
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| China Administration of Food & Commodity Reserves. |
China also produces medium grain (japonica) rice in northeastern provinces and in parts of Jiangsu, Anhui, and Hubei Provinces. State media in the largest medium-grain producer, Heilongjiang Province, reported after last year's marketing season that the Province's procurement of rice at the minimum price over the past 3 years totaled 2.9 million metric tons (mmt) in 2023/24, 5.4 mmt in 2024/25, and 3.67 mmt in 2025/26, but the article insisted that rice procurement in Heilongjiang is becoming more marketized.
This month, some market reports say medium grain rice prices are firm, but the food and commodity reserves administration data show the average price dropping to RMB 2,638 per metric ton, slightly above the minimum for medium grain of RMB 2,620. Heilongjiang Province has also launched price support purchases of medium grain rice.
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| China Administration of Food & Commodity Reserves. |
A MySteel market report this week said indica rice has been priced mostly at RMB 2,500 to 2,600, and japonica rice has been priced at RMB 2,620 to 2,360. According to market monitoring organization MySteel, prices for high-quality rice are resilient, but supplies of standard-grain medium grain rice are putting downward pressure on prices. MySteel notes that supplies of premium aromatic rice are tight because planting of premium varieties declined this year (defying Xi Jinping's orders to raise the quality of products).
MySteel commented that demand for rice from end-consumers has been lackluster and noted a regional divergence in this year's rice quality, with the quality of rice falling short of expectations in some regions. While market reports don't mention it, rice-growing areas of South China experienced extreme flooding this summer from typhoons which surely inundated rice fields--mostly located in low-lying areas near rivers and canals--and surely damaged or degraded rice crops.
A September 15 State media article promoting the benefits of the rice price support program ahead of the Fall harvest revealed that 900,000 metric tons of early indica rice had been purchased at minimum prices during the summer (the marketing season for early rice ended September 30). This exceeded the 780,000 metric tons of early rice purchased at minimum price in 2025. The article boasted that State-owned companies have been proactive in entering the market to influence prices but also emphasized that 95% of procurement was market-driven. Another article distributed by Sinograin, China's grain reserve company, described the summer's procurement of at minimum prices as a "safety net" to ensure farmers can break even on rice production and encourage them to keep planting rice. The article noted that purchases are activated only after the price delivered to warehouses remains below the minimum for 3 days. It claims that the minimum price program bolstered the selling price of farmers by RMB 60 to 100 per metric ton.
This year Chinese authorities tried hard to jettison excess rice stockpiles. From March 31 through September 29 2026, the country's stockpiler held weekly auctions offering 600,000 metric tons of rice for sale, a cumulative total of 16 million metric tons. Auctions mostly offered medium grain rice that had been procured between 2022 and 2024. However, interest in the auctions was weak: only 1 mmt was actually sold at prices equal to roughly $400 per metric ton. Auctions stopped in October as the Fall harvest began.
By preventing declines in price, the price support program props up Chinese rice prices at levels higher than those received by rice growers in India, Vietnam, and Pakistan. There is little upward pressure on Chinese rice prices since per-capita consumption is declining, and Chinese farmers are shielded from declines in global price that signal excess supply. The result is that Chinese rice prices show little fluctuation and now exceed prices in exporting countries by a wide margin in most years. International prices briefly exceeded Chinese internal prices during 2023-24, but in 2025 prices in rice-exporting countries fell to about 30% below Chinese prices. In 2026, international prices rebounded but are still about $100-per-ton below Chinese prices.
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| Compiled from UN Food and Agriculture Organization database. |
The spread between Chinese and foreign rice prices triggers imports by bargain-hunting buyers in China looking to cut raw material costs--despite China's glut of rice. During January-September 2026 China imported about 3 million metric tons of rice, up from about 2.3 million metric tons during the same months a year earlier. (Total imports for China's October 2025-September 2026 market year reached about 2.9 mmt.)
China imports predominantly long grain rice. Most of this year's increase reflects imports of broken rice (both long- and medium-grain), the cheapest type of rice used mainly in food and liquor processing, to mix with food-grade rice to cut costs, or as animal feed when the price is right. The average cost of China's rice imports during Jan-Sep 2026 is just $433 per metric ton, down from $467 per metric ton during the same period in 2025. The increased proportion of broken rice accounts for the lower unit cost of rice imports this year. Note that the average domestic price of (milled) indica rice in China is much higher, at $570 per metric ton.
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| China customs data. |
China a top exporter of rice as the country dumps rice from government stockpiles on the international market. China's rice exports during January-September 2026 exceeded 1.2 million metric tons up from about 900,000 metric tons a year earlier. (China exported 1.9 mmt for the October-September market year). China's exports were mostly composed of medium grain rice, rising from 739,000 metric tons during January-September 2025 to 887,000 metric tons during the same months in 2026. This year exports of long grain rice more than doubled to nearly 350,000 metric tons during the first 9 months of 2026, up from 150,000 metric tons during the same months of 2025.
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| China customs data. |
China's rice exports obviously are being "dumped" on the world market because exported rice prices are substantially below internal market prices. In March 2025, the average unit cost of exported medium grain rice fell to $502 per metric ton, below China's domestic market price of milled medium grain rice of $578 that month. In subsequent months export prices fell even lower, and the spread between export prices and domestic prices widened. In September 2026 China exported 138,213 metric tons of medium grain rice at an average price of $383 while domestic prices averaged $627, a difference of $244 per metric ton (-39%).
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| Export price is average value of exported rice; domestic price is national average reported by UN FAO GIEWS database converted to USD at official exchange rate. |
Long grain rice was also exported at discounted prices. The average price of exported indica rice in 2025 was $390 per metric ton, less than the average domestic price of $552 per metric ton. During 2026 the export price averaged $427 per metric ton, again less than the average domestic price of $568 per metric ton.
Customs data show that Beijing-based companies accounted for 96% of China's rice exports in 2026, clearly indicating that China's Beijing-based Sinograin state stockpiler is the source of the exported rice. China has accumulated large amounts of surplus medium grain rice in reserves that it has failed to sell at auctions (as described above), so dumping it abroad is a convenient outlet.
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| Loading early indica rice into a grain reserve warehouse last summer. |
Chinese authorities may be dumping cheap rice from their reserves as a tool to build Chinese soft power in developing countries or to feed Chinese laborers working on infrastructure projects abroad. There were nearly 50 destinations for China's rice exports, including most countries in Africa led by Cameroon, Libya, and Cote d'Ivoire. Papua New Guinea was also a top destination. Struggling communist dictatorships Cuba and North Korea also received Chinese rice.
China's rice exports replicate the 20th century result of price support programs when the United States and other developed countries dumped surplus grains abroad in the guise of food aid. Restraints on domestic support adopted by the WTO during the late 20th century were designed to stop such dumping of grain in Africa and other developing countries.
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