Malaysian Ports Report Persistent Wet Bulk Congestion
Southeast Asian supply chain risks persist, as port data indicates ongoing congestion in wet bulk terminals at key Malaysian ports. Both Kota Kinabalu and Port Klang are experiencing bottlenecks, serving as a reminder for rice exporters to factor potential shipping delays into their logistics planning for both regional and European shipments.
- The congestion at Port Klang is exacerbated by diversions from the Red Sea, where Houthi militant attacks have forced about 80% of ships to reroute around the Cape of Good Hope. This has led to vessel bunching and berthing delays averaging 9.3 hours at Westports and 1.9 hours at Northport as of April 2024. - India, the world's largest rice exporter, lifted its ban on non-basmati white rice exports on September 28, 2024, and removed restrictions on 100% broken rice on March 7, 2025. This policy shift has significantly increased global supply, causing prices for 5% broken rice from competitors like Vietnam and Thailand to drop by 38-45% in early 2025. - While global shipping disruptions have increased freight rates on Asia-to-Europe routes by more than double, Malaysian ports and exporters have reportedly experienced minimal impact on trade routes to Europe and the US due to a strong focus on intra-Asia trade. - The Thai Baht (THB) has fluctuated against the Euro (EUR), with the European Central Bank noting a 12-month range between 35.066 and 38.282 THB to one EUR. Forecasts for early 2026 anticipate the exchange rate to be around 0.026000 EUR to one THB. - The European Union has adjusted its import regulations for rice, setting a tariff of €42.50 per tonne for husked rice under CN code 1006 20 (excluding certain Basmati varieties) as of September 2024. This is part of a broader effort to protect the EU's domestic rice industry. - Competition within the ASEAN region is shifting, as Indonesia announced plans in May 2025 to begin exporting 2,000 tonnes of rice per month to Malaysia, following the achievement of a record domestic rice reserve of over 4 million tons. - To compete with the influx of Indian rice, the Việt Nam Food Association has stated a strategic focus on developing fragrant and high-quality rice varieties, while reducing reliance on lower-quality grains. Vietnam's rice exports set records for volume and value in 2024.
