Costa Rica Rice Tariffs Boost US Exports

The USDA Foreign Agricultural Service reports the re-imposition of tariffs on non-US rice by the government of Costa Rica has led to a rebound in demand for US traders.

Costa Rica reinstated 35 percent tariffs on non-U.S.-origin rice after an administrative court overturned an August 2022 tariff reduction and the Government’s appeal was rejected.

Demand for U.S. rice has surged following the tariff restoration on reduced South American-origin rice competitiveness. Costa Rican import demand has grown by more than 50 percent since 2022, as area planted to rice has fallen by more than half.

U.S. rice exports to Costa Rica plummeted in late 2022 and had remained negligible in 2023, despite duty-free quotas totaling more than 75,000 metric tons.

Rice Quotas

FAS/San José anticipates Costa Rica's Ministry of Foreign Trade to allocate 2024 Dominican Republic - Central America Free Trade Agreement rice quota allocations by the end of April, effectively constraining the availability of U.S. duty-free rice to the final eight months of 2024.

Though Costa Rica typically allocates quota volumes in December of the preceding year, calculations of 2024 volumes have been contested by importers following an extraordinary process resulting from a 2022 cyber attack. The allocation delay became a significantly more pressing issue after Costa Rica restored 35 percent tariffs on non-U.S.-origin rice on April 11, instantly increasing price competitiveness of and demand for U.S. duty-free rice.