Rice interests deny rice shortage despite rationing sales
Despite news of big box Sam's Club and Costco rationing rice sales, industry officials are saying there is no rice shortage in the United States.
On the same day U.S. rice futures hit an all-time high on worries of worldwide supply shortages, some analysts said that U.S. warehouse chains may be seeing more of a short-term stockpiling reaction from restaurants and small stores.
'It’s possible that small restaurants and bodega-type neighborhood stores may be purchasing rice in larger quantities than they do typically to avoid higher prices,' USA Rice Federation spokesman David Coia told the Associated Press on Tuesday.
Worldwide demand and poor crop yields have led to a 70 percent increase in world rice prices this year, following closely on the heels of similar spikes in the price of wheat, corn and soybeans that have seen sizable jumps in American grocery prices and led to violent food riots in several countries including Haiti, Senegal and Pakistan.
According to the U.S. Department of Agriculture, U.S. production of long grain and medium grain rice is strong, and the global crop is larger than ever. However, recent export controls instituted by major rice producers such as India and Vietnam to keep their domestic prices down, have also contributed to higher international prices.
The Sam's Club division of Wal-Mart Stores on Wednesday announced it would be rationing rice at its chain outlets, citing 'recent supply and demand trends.'
While the Wal-Mart's 2,523 grocery-selling stores do not intend to limit purchases, the 593 Sam's Club stores nationwide are limiting customer purchases to four 20-pound bags of imported jasmine, basmati and long grain white rice per visit.
Seattle-based Costco Wholesale Co., the nation's leading warehouse club operator, confirmed Tuesday that some of the firm's stores were rationing rice, flour and oil, though no chain-wide limits were officially in place. Costco Chief Executive Officer James Sinegal told Reuters on Tuesday that his firm had seen 'unusual demand' for items like rice and flour over the previous week to 10 days and that some stores may have taken 'precipitous action' in instituting limits.
Sinegal has since declined to comment on the issue and Sam's Club officials have declined to speculate on the cause of the shortages.