Global rice prices could climb even higher after rising for the fifth straight month to reach a 12-month high, CNBC reported on Sunday, citing industry experts.

What Happened: Rising prices of other commodities and higher costs of farming put rice prices on the watchlist next despite a bountiful production of Asia’s staple grain.

“We need to monitor rice prices going forward because rising wheat prices could lead to some substitution towards rice, increasing demand and lowering existing stocks,” the report said, citing Sonal Varma, the chief economist at Japanese bank Nomura.

Rising costs of fertilizer and energy in the past year, as well as the Russia-Ukraine war, have driven prices higher for many food items including wheat, other grains, meat, oil, and more.  

China, India, Indonesia, and Bangladesh are the top four rice-producing nations in the world, as per data from the World Economic Forum.

Rice Ban? India in May banned wheat exports to keep high prices in check amid concerns that output was being hit by a scorching heat wave. It slapped restrictions on sugar days after that. 

“Right now, I will be much more worried by India slapping an export ban on rice in the coming weeks — as they were thinking about after wheat and sugar,” the report said, citing David Laborde, a senior research fellow at the International Food Policy Research Institute.

Why It Matters: COVID-19-linked shutdowns, clogged supply chains, and Russia’s invasion of Ukraine have sent prices higher, making inflation a household name globally.  

Industry leaders, including Tesla Inc TSLA CEO Elon Musk, have warned the U.S. could already be under a recession

Billionaire Ray Dalio’s hedge fund Bridgewater Associates has said the market is yet to price in an economic slowdown in the U.S., and there could be more pain in the offing. 

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