India bans rice export, triggering panic-buying among Indians in US

The recent ban on the export of non-basmati white rice by India has sent shockwaves through Asian communities in the United States. India's Food and Consumer Affairs Ministry's decision, aimed at stabilising domestic retail prices due to rain-induced rice production challenges, has led to panic-buying and hoarding of rice at grocery stores across the United States.

With parboiled rice exempted from the ban, anxious customers thronged stores to stock up on their staple, resulting in long queues and soaring prices.

Stores take advantage

• As reports show, Indian-owned grocery stores in Texas are capitalising on the situation, increasing the prices of rice bags and imposing purchase restrictions on customers.

• Price hikes of up to 11 per cent have been observed in the American rice market, adding to the anxiety of consumers who rely on rice as a dietary staple.

• Videos of panic-buying, particularly of the popular Sona Masuri variety, have gone viral on social media, raising concerns about hoarding and black marketing.
• Some of the panicking has to do with rumours about supermarket empty shelves, as well.

Concerns

• The ban's initial impact on the Indian diaspora in the US and Canada seems profound, especially among those who prefer varieties like Sona Masuri and Seeraga Samba.

• NRIs (Non-Resident Indians) from Telangana and Andhra Pradesh have expressed worries about the ban's duration and its effects on their daily consumption patterns.
• Some have criticised the panic-buying conduct of buyers, calling for consideration and empathy for others in the community.

Calls for consideration

• Industry experts and traders' unions have suggested that the Indian government should consider categorising specialised rice varieties like Sona Masuri under a different Harmonized System Nomenclature (HSN) code, allowing their export.

• This would ensure adequate availability of such rice varieties to the Indian diaspora and other global consumers.
• Efforts to cultivate premium rice varieties in Africa are also underway to cater to the demand for Indian rice abroad.

Impact on global prices

• The ban's repercussions are to be felt in the global rice market, leading to surging rice prices abroad as India exports rice to more than 140 countries.
• Indian white rice, which was previously affordable, now commands a significantly higher price, causing concern among consumers.
• India exported 17.86 million tons of non-basmati rice in 2022, including 10.3 million tons of non-basmati white rice.
• Moreover, more than 40% of the world's rice exports come from India.

• This move could, in turn, adversely affect food security in many middle- and low-income countries.
• The ban is viewed as a measure to address rising domestic foodgrain prices and slow progress in Kharif paddy sowing this year, but it has raised worries among rice-importing countries.

While panic-buying remains widespread, some analysts believe that the export ban's impact may be short-lived, possibly lasting for about six months. The ban's timing, with elections in India, has also raised questions about its political implications.