Trump’s Iran war is forcing Thai and Vietnamese farmers to rethink planting rice

Shipping delays and surging logistics costs tied to the Iran war are disrupting rice exports from Thailand and Vietnam, two of the world’s largest suppliers. Vietnam primarily ships rice to regional markets such as the Philippines and China, while Thailand supplies key Middle East buyers including Iraq. Exporters report longer delivery times, contract renegotiations and weaker prices as shipments are delayed.

The conflict has pushed up global energy costs by disrupting flows through the Strait of Hormuz, which carries about 25% of seaborne oil trade. Higher fuel prices have increased the cost of farm operations and transport across rice-producing regions.

The Food and Agriculture Organization of the United Nations said its All Rice Price Index fell 3% in March 2026 amid ample supply and softer demand, limiting exporters’ ability to pass on higher costs.

Vietnam’s rice exporters have faced higher costs since March as Middle East tensions affected logistics. Nguyen Anh Son, director general of the Agency of Foreign Trade under Vietnam’s Ministry of Industry and Trade, said delivery times have lengthened by 10 to 15 days, insurance premiums have increased and domestic transport costs have risen by 20,000 to 30,000 dong, or about $0.76 to $1.14 per metric ton.

Container shortages and schedule changes have forced some exporters to renegotiate contracts or delay shipments. The disruptions have affected deliveries to Middle East markets including Iraq and the United Arab Emirates.

Do Ha Nam, president of the Vietnam Food Association and general director of Intimex Group, said sustained pressure could affect production decisions. “When costs rise and selling prices do not keep pace, leading to decreased efficiency, it is inevitable that rice farmers will consider switching crops,” Nam said.

Thailand faces sharper disruption because of its reliance on Middle East buyers. Iraq accounted for about 75% of Thailand’s rice exports to the region, which total about 1.34 million metric tons a year.

Thai exporters said shipments to Persian Gulf destinations have been effectively halted as vessels avoid routes through the Strait of Hormuz. Freight rates rose more than 40% in March due to higher fuel costs, surcharges and war-risk insurance, while importers have delayed orders amid uncertainty over delivery timelines.

Thailand exported 7.9 million metric tons of rice in 2025 and set a 2026 target of 7 million metric tons. Officials warned the country could miss that target if disruptions continue. Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association, said Thai exporters are concerned about disruption to Middle East shipments. “We are so worried,” Chookiat said.