The recent announcement by the Indian government to impose a ban on the export of non-basmati white rice on July 20 has sparked widespread panic buying in North America, Europe, and West Asia. Reports indicate that Indian grocery stores in these regions are witnessing long queues as NRIs rush to secure rice supplies. As WhatsApp forwards and news alerts spread information about the ban, a surge in panic buying of rice is being witnessed at various stores across the country.
In the wake of a ban on the export of non-Basmati rice varieties by the Indian government, Non-Resident Indians (NRIs) residing in the United States have embarked on a frenzy of rice shopping from India. The ban, which was implemented on July 20, has raised concerns over potential rice shortages, leading to panic buying in North America, Europe, and West Asia. Reports indicate that Indian grocery stores in these regions are witnessing long queues as NRIs rush to secure rice supplies.
The Times of India recently published a report shedding light on the escalating situation, with particular emphasis on the significant demand among the Tamil community. Major cities in Texas, Michigan, and New Jersey have seen overcrowded grocery stores, as multiple customers scramble to stock up on rice.
Numerous stores have put up notices stating “only one rice bag per family” to manage the situation and ensure fair distribution. However, concerns about hoarding have also arisen, with apprehensions that some may stockpile rice and attempt to sell it at significantly higher prices through online forums.
The current price for a 9 kg rice bag stands at $27, as reported by TOI. In response to the surge in demand, stores have had to impose certain conditions on customers, limiting the sale of rice to one bag per individual.
Interestingly, the situation in the UK and Ireland contrasts with that in the US, as no such rush has been observed at grocery stores for rice, according to a restaurant owner’s statement.
India holds a prominent position in the global rice market, accounting for 40% of rice exports. The recent ban on non-Basmati rice varieties’ export was a response to multi-year high rice prices, driven by unpredictable weather conditions that posed threats to rice production. During the second quarter, Indian exports of non-basmati white rice surged by 35% compared to the previous year, primarily due to heightened global demand.
Several countries are expected to be affected by the ban, including various African nations, Turkey, Syria, and Pakistan, all of which are already grappling with elevated food-price inflation. Notably, some of the top purchasers of Indian non-basmati rice include Benin, Senegal, Ivory Coast, Togo, Guinea, Bangladesh, and Nepal.
This is not the first time India has taken measures to control its food exports. In September of the previous year, the country imposed a ban on broken rice exports and levied a 20% duty on non-Basmati rice exports, with the exception of parboiled rice. These decisions were prompted by concerns over reduced production estimates, attributed to a decline in the area under paddy crop. However, the ban was lifted in November.
In a bid to stabilize prices, India also placed restrictions on wheat and sugar exports last year.
As rice is a major staple in global food consumption, international rice prices have soared to decade-high levels due to various factors, including the challenges posed by the Covid pandemic, the conflict in Ukraine, and the impacts of the El Niño weather phenomenon on production levels.
With the ban on rice exports from India, NRIs in the US are bracing for potential scarcity and subsequent price surges. Many are opting to purchase multiple rice bags from nearby grocery outlets in an effort to secure their rice supplies in uncertain times. The situation has underscored the importance of stable global food supply chains and has triggered concerns among NRIs about the availability and affordability of this essential food item.