Rafael has been one of United's most consistent performers this season and has played a key role in the club leading the Premier League table by 15 points.
The Brazilian has added maturity to his game this term and Valencia has noticed Rafael's transformation over recent months.
"It's incredible how much he's improved," said Valencia. "I've seen a big improvement in his level of concentration.
"If he continues, it won't be long before he's one of the best right-backs in the world."
Valencia has acknowledged it has been a disappointing season on a personal note and the winger has been hampered by niggling injuries.
He hopes to play a role in United's bid to wrap up a 20th top-flight title and also expressed his admiration for evergreen colleague Ryan Giggs.
The Ecuador international added: "I hope I've an important part to play between now and May. I hope I'm involved in as many games as I can.
"If picked, I'm determined to grab my opportunities and do my best for everyone.
"I admire and learn from Ryan Giggs and Nani every day. They are great pros and players who work hard to become the best they can be. Ryan's desire to win is as strong as ever."