Rice prices surge to 7-year high as coronavirus sparks stockpiling
April 08, 2020 @ 11:40 +03:00
The price of rice — a staple food in Asia — has hit 7-year highs due to the coronavirus outbreak as importers rush to stockpile the grain while exporters curb shipments.
According to the Thai Rice Exporters Association, price of the 5% broken white rice — the industry benchmark — rose 12% from March 25 to April 1. Rice prices are now the highest since late April 2013, according to Reuters data.
The rise in prices is due to expectations of higher demand for Thai rice after fellow top exporters India and Vietnam both face export disruptions of the strategic staple food due to the outbreak of the coronavirus disease, formally known as COVID-19. Asia produces 90% of the world’s rice supply and consumes the same amount.
In India, rice traders have stopped signing new export contracts as labour shortages and logistical disruptions hamper the delivery of existing contracts, Reuters reported, citing industry officials. The Vietnamese government meanwhile has put in export curbs.
Even before the March spike, rice prices had started climbing in late 2019 due to a severe drought in Thailand and strong demand from Asian and African importers. Thailand is the world’s second-largest exporter after India and ahead of Vietnam.
The gain in prices comes despite expectations of robust production this crop year and carry-over stocks of rice and wheat being at all-time highs, said Samarendu Mohanty, Asia regional director at the Peru-based International Potato Center, a non-profit group researching food security.
North America, Europe and China are now facing labor shortages and supply line disruptions for spring planting, he added. “If they miss the planting window, they are done for the entire year.”
Rice prices surge to 7-year high as coronavirus sparks stockpiling, CNBC, Apr 8