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CHICAGO, April 18: With established trade trends in rice being blurred by tight global supplies that have sparked global food riots, US exports are set to grow and enter more new markets.
Panic buying of rice futures at the Chicago Board of Trade took prices to record highs on Thursday, which is expected to fuel already surging values for the staple in Asia.
The clampdown on shipments by major rice exporters in a bid to ensure food security and contain inflation over recent months has pushed new demand to the US, the world’s fourth largest exporter of the grain.
“The global influx to the United States for rice is indicative of the underlying global supply problem,” said Thomas Wynn, director of market development for the US Rice Producers Association.
“The rice trade has traditionally been hemispheric. The western hemisphere typically served the western hemisphere and the eastern hemisphere would circulate its rice in the east.
“We’ve definitely thrown the historic trends out the window,” he told Reuters.
He said there has been talk among some traders that Turkey, traditionally a buyer of medium-grain rice, may be interested in buying long-grain US rice. Other traditional buyers of Asian-origin rice, like Iran and some east African nations, may be interested in US supplies, he added.
“Looking at the potential new markets for US rice, we should start to see those materialise in the next month or two when the supply shortage really begins to make itself apparent,” Wynn said.
Rice has become the latest food commodity to jump to historically high prices, joining wheat, corn and soybeans.
Surging prices and concerns about rice shortages have already sparked protests and riots around the globe and played a role last week in the collapse of the Haitian government.
Top consuming countries are hoarding supplies and several top exporters have banned exports to help stabilize domestic prices and stave off inflation. They include India, Vietnam, and Pakistan, three of the top five exporting nations last year.
-—Reuters
