US farmers are planting the fewest hectares with rice since 1989 just as global demand surpasses production for the first time in four years, driving prices as much as 12 per cent higher by December.

Plantings in the US, the third-biggest shipper, may drop 25 per cent this year because growers can earn more from corn and soybeans, according to the median in a Bloomberg survey of nine analysts and farmers.

Rice, the staple food for half the world, declined 4 per cent last year, extending a 2.9 per cent drop in 2009.

The other crops jumped 34 per cent or more.

"Why would you want to take that risk to plant rice, knowing that your income is going to be way down?" said Terry Hatley, a farmer in Marked Tree, Arkansas.

"Farming is a business, and you've got to look at the economics of it. Now, the economics on rice are very dim."

Bangladesh, South Asia's biggest buyer, doubled a target for imports this year to curb prices, the directorate general of food said last week. The Philippines, the world's largest importer, will probably start buying next month, says the National Food Authority.

While global stockpiles are predicted to be 26 per cent higher this year than in 2007, consumption will gain 3.4 per cent and harvests 2.6 per cent, the US Department of Agriculture estimates. The Thailand export price, the benchmark in Asia, may climb as high as US$600 ($777) a tonne by December from US$534 on January 26, a gain of 12 per cent, according to the median estimate in a Bloomberg survey of eight traders, exporters and analysts.

"The acreage war has begun," said Dennis Delaughter, the owner of Progressive Farm Marketing in Edna, Texas, who expects futures traded on the Chicago Board of Trade to advance as much as 20 per cent to a three-year high of US$18 a 45kg by November.

"Of all the futures markets in the agricultural sector, rice is the sleeper," said Delaughter, who correctly predicted an 11 per cent gain in prices last March.

Rice represents almost 50 per cent of the food expenses of the poorest across the developing world, and 20 per cent of total household spending, according to the International Rice Research Institute, based in Los Banos, the Philippines.

While the United Nations says global food prices climbed to a record in December, grain stockpiles have been replenished since 2007-2009, when the US State Department estimates there were more than 60 food riots around the world.

- BLOOMBERG