By George Jared
Mediocre commodity prices, over supply, and federal policy uncertainty will likely lead to a smaller 2025 rice crop in Arkansas. Arkansas, which produces about half the nation’s rice, had back-to-back record seasons, but that’s likely to change this year.
Grayson Daniels, Riceland Foods vice president of grain sales and procurement, said it’s likely that acres and yields will be down this growing cycle. Overall production is projected to be down 8%.
About 1.44 million rice acres were harvested last year in the state. Growers had record average yields of 7,640 pounds per acre, producing more than 109 million hundredweight of rice, according to the U.S. Department of Agriculture (USDA). Jarrod Hardke, extension rice agronomist, said that while growers managed significant yields despite harsh weather conditions, those same conditions reduced profitability.
Global rice markets seem to be relatively steady. The global rice market is valued at $309.8 billion in 2024, according to the USDA.
“We’re consuming and producing about the same amount of rice in the world right now,” said Daniels.
Rice prices hovered around $14 per bushel toward the last week in February, up slightly from a 52-week low of $13.38 per bushel earlier in the month. During the last year, the per bushel price had a high of more than $19, according to Business Insider.
Daniels said he doesn’t think prices will improve a lot during this next growing season, but there are a couple of factors that could lead to better prices. The U.S. has been selling and continues to try and open new markets around the world, including Iraq. Demand within the U.S. has also been strong, he said.
On the flip side, South American farmers are about to harvest their crops and if the numbers are good, it could depress prices, he said. Asian rice markets have been soft and the lingering threat of tariffs by President Donald Trump could negatively impact rice prices.
SOYBEAN TRENDS
Prices for the most widely grown crop in Arkansas, soybeans, remain low and there will likely be a drop in statewide and national acres grown this year, but it won’t necessarily lead to more rice acres.
Soybeans have been trading at around $10.34 per bushel, a more than 11% drop during the last year, according to Business Insider. Soybean acres nationwide could decline up to 3 million acres, Daniels said.
Last year in Arkansas, soybeans failed to keep up with production costs. Per-bushel prices fell to an average of $10.80, a $1.25 decline from forecast prices earlier in the spring. About 3 million soybean acres were harvested in the state last year, according to the USDA’s National Agricultural Statistical Service (NASS).
A large South American crop, tariffs, world soy stock surpluses and the Chinese preference for South American soybeans could lead to further downward pressure on prices, he said.
FARM BILL, POLITICS
One way to alleviate pressure on producers would be to pass a new federal farm bill, Daniels said. A new farm bill has not been passed since 2018, and it has reference crop prices that date back to 2012.
Last year, the U.S. House of Representatives passed a farm bill that raised rice reference prices from $14 to $16.90 per bushel; soybeans went from $8.90 to $10; and corn from $3.70 to $4.10.
The bill stalled in the U.S. Senate and still hasn’t been passed. The chances of passing a new farm bill this year with razor thin margins in both the House and Senate are not good, said Michael Klein, USA Rice vice president for communications and strategic development.
“It’s going to be really tough to get one passed,” he said.
Many federal programs such as USAID have been paused or closed and it’s causing a humanitarian crisis, Klein said. Programs like USAID buy food from U.S. farmers and distribute them around the world. Farmers losing out on sales is bad, but people starving is much worse, he said.
Trump appointed billionaire Elon Musk to operate his Department of Government Efficiency or DOGE. Klein said Musk is unelected and has a track record of not honoring contracts within the businesses he buys. Klein said his organization and many others have contracts with the federal government and he hopes they are honored.
“That’s his business approach and it scares me,” said Klein. “We think we are in good standing [with the contracts]. We will see how this plays out.”
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