Iraq Purchases U.S. Rice for the First Time in Nearly Two Years

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Freight Containers on a Ship | Photo by Andy Li

In July 2021, Iraq purchased 120,000 tons of U.S. long-grain rice (though it has not yet shipped), the first purchase since 2019. The United States has been an important supplier of long-grain rice to Iraq for over two decades.

Iraq is a major rice importer in the Middle East and imports from both Asian and Western Hemisphere suppliers. However, 2020 was atypical for the Iraqi rice market, as its overall imports were down by approximately 20 percent with India supplying most followed by small amounts from Vietnam, Turkey, and Thailand.

Source: U.S. Census Trade Data

While traditional suppliers lost market share in Iraq in 2020, India milled rice exports to Iraq increased by almost 40 percent. The Government of Iraq has traditionally been a major buyer for its Public Distribution System (PDS), buying mainly from approved origins including the United States.

NonPDS, private-sector rice imports have been rising, and private-sector buyers have been attracted to India’s competitive prices for basmati in 2020. Almost all Indian rice exports to Iraq are milled rice, with the majority being basmati rice.

This new sale is welcomed by U.S. rice exporters and the rice milling industry since the Iraqi rice market has also been a historically significant market for U.S. long-grain rice producers. Other than in 2020, in recent years Iraq consistently lands as a top-five export market for U.S. long-grain rice.

Freight Containers on a Ship | Photo by Andy Li

In contrast to sluggish imports in 2020, Iraq is forecast to increase its rice imports in 2021 driven by projections for higher consumption, thus granting U.S. exporters the opportunity for additional future sales. However, Iraq appears to be diversifying its suppliers, as demonstrated by recent purchases from Uruguay and Thailand.