India's rice export ban sparks panic buying among US Asian communities
Basmati ban row: The recent ban on the export of non-basmati white rice by India has caused panic buying among the Indian diaspora and other Asian communities in the United States. The Food and Consumer Affairs Ministry imposed the ban on July 20 to stabilise volatile retail prices within India, as rice production has been impacted by erratic weather conditions, including heavy monsoon rains in rice-producing states and deficit rainfall in other parts of the country.
The export ban specifically targets non-basmati white rice, while parboiled rice remains exempted. The government's intention is to ensure sufficient availability of non-basmati white rice in the Indian market and to mitigate the rise in domestic prices.
Highlighting the problem, a Twitter user took a dig at the IQ level of some Indian-Americans and wrote: "So all the desi stores are out of Indian rice. Every NRI family has bought 10-15 bags of rice because India has blocked export of “non-basmati” rice. Therefore high IQ NRIs have hoarded 100-200kgs of basmati rice per family. And few are now selling it on FB marketplace".
So all the desi stores are out of Indian rice. Every NRI family has bought 10-15 bags of rice because india has blocked export of “non-basmati” rice. Therefore high IQ NRIs have hoarded 100-200kgs of basmati rice per family.
And few are now selling it on FB marketplace ???????????? — Niks (@niks_1985) July 22, 2023
⛔️ Panic within NRIs in US for rice #IndiaBansRiceExport https://t.co/QdEz8udocl pic.twitter.com/39rWXBnG3S — Kreately.in (@KreatelyMedia) July 21, 2023
In response to the ban, reports from the US indicate that all varieties of rice are flying off the shelves at stores, with anxious Asian communities rushing to stock up on their staple food. In some places, stores have enforced rationing, limiting customers to purchase only one 20-pound bag of ordinary white rice per person. Major brands also experienced high demand, leading to sold-out stocks within hours.
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⛔️ Hoarding happens in US too!
Rice export ban from India triggers chaos pic.twitter.com/7zZR7lHrFR — Kreately.in (@KreatelyMedia) July 21, 2023
"A lot of WhatsApp University forwards are like "life is very difficult in America and Canada" and yeah, not minimizing immigrant struggles, but let's take a step back and note what a moment of collective affluence this is. We are having a run on Basmati rice! A premium product!," tweeted the user.
A lot of WhatsApp University forwards are like "life is very difficult in America and Canada" and yeah, not minimizing immigrant struggles, but let's take a step back and note what a moment of collective affluence this is. We are having a run on Basmati rice! A premium product! https://t.co/htd2jxwQDQ — Gaurav Sabnis (@gauravsabnis) July 22, 2023
The impact of the ban is not limited to the US, as prices of rice have risen by approximately 11 per cent in the country. In Texas, where there is a large Asian population, prices have been reportedly hiked. This situation brings back memories of a similar crisis three years ago when India restricted wheat flour exports.
Despite concerns about global food prices being affected by the ban, shipments already cleared for export at ports will not be affected. Experts suggest that the worldwide rice scarcity caused by various factors, including weather conditions and conflicts, may ease by 2024.
Major markets for Indian rice are African countries, and India is one of the leading producers and suppliers of rice globally, alongside China, Thailand, Vietnam, and Pakistan. The ban's impact is likely to be felt in various parts of the world as the situation unfolds.
Effective immediately, India has imposed a ban on the export of non-basmati white rice (Semi-milled or wholly milled rice, whether or not polished or glazed). The Ministry of Consumer Affairs, Food and Public Distribution made this decision to ensure sufficient availability and stabilize prices of non-basmati white rice in the Indian market. The export policy for this variety has been amended from 'Free with export duty of 20 per cent' to 'Prohibited.'
India's move comes in response to the price surge of non-basmati white rice in the domestic market, where retail prices increased by 11.5 per cent over a year and 3 per cent in the past month.
In September 2022, India had already imposed a 20 per cent export duty on non-basmati white rice; however, the exports continued to rise from 33.66 LMT (Sept-March 2021-22) to 42.12 LMT (Sept-March 2022-23), affecting prices and availability locally.
The export policy for non-basmati rice (parboiled rice) and basmati rice remains unchanged. India plays a crucial role in fulfilling 40 per cent of the world's rice needs, with non-basmati white and broken rice accounting for approximately 10 million tons of the total 22 million tons of Indian rice exports last year.
With India's ban in place, buyers may turn to Thailand and Vietnam, but their 5 per cent broken rice is expected to cost around $600 per metric ton. Industry experts warn that India's decision could have significant ramifications on the global rice market, likening it to Ukraine's impact on the wheat market due to Russia's invasion.
B.V. Krishna Rao, president of the Rice Exporters Association, emphasized that India's actions could disrupt the global rice market at a rapid pace.
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- With inputs from agencies
