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Arkansans won't escape effects of global tightening of rice supply Saturday, May 3, 2008 By Jason Wiest Arkansas News Bureau LITTLE ROCK - Less than a three-hour drive from riceland that feeds people worldwide, the manager of an Asian restaurant in Russellville would like to build a stockpile of rice that would last at least half a year. A tightening of the global rice supply concerns Mulan's manager Gigi Ni, and having the world's largest rice processing and exporting facility less than 150 miles away in Stuttgart is no comfort, she said. "The prices are already going up," to as much as $22 per 50-pound bag, depending on the distributor, she said. Not long ago, prices were in the $15 to $16 range. Last week, Ni tried to order 5,000 pounds of rice from Sysco Food Services of Arkansas, while her buffet style restaurant only uses about 200 pounds a week. Officials for Sysco, the largest food distributor in Arkansas, told her they could not accommodate her, not because they didn't have access to that much rice, but because it would slow deliveries to other customers. Rice consumers of all types around the country are getting the same message. To help ensure customers can get rice, Sam's Club has limited purchases of jasmine, basmati and long-grain white rice to four bags a visit in all U.S. stores. The increase in rice prices, not a shortage of the product, is the actual cause behind the food frenzy, said Brandy Carroll, coordinator of the Arkansas Farm Bureau's rice division. "It's not an actual shortage," although demand has outpaced supply for the past seven years, Carroll said. "Stocks have been declining for seven years globally, but there's not been a major price connection until this year, and it really has more to do with the cost of fuel and transportation and getting the rice out more than anything." Arkansans are familiar with exporting rice. The U.S. is the fourth largest exporter of rice, and about half of the rice grown in the U.S. is grown in the Natural State. Roughly half of the nation's overall supply, which accounts for between 1.5 percent and 2 percent of the world's supply, is exported, while the other half meets about 90 percent of the nation's rice demand. Most other countries consume all the rice they grow. With global demand surging, the U.S. rice crop, as well as rice exports, are projected to increase, Carroll said. Farmers probably will moderately increase the amount of rice they plant this season, according to current U.S. Department of Agriculture projections. As for last year's rice crop, exports are projected to be 26 percent higher than for the previous year's crop. "The U.S. really right now is one of the few countries still willing to export rice," Carroll said, while other countries that traditionally have exported little rice are now halting any exports at all. "The rice mills in the U.S. continue to assure everybody that no only do they have plenty of rice to service the domestic market base, they also have enough rice to service their traditional export customers as well," she said. Although the availability of rice in the U.S. will not decrease, the price of rice will because it's based on global demand, Carroll said. Cost is Ni's prime concern at Mulan's. Sysco officials say they are advising their clients to take a look at their menus and consider an increase in prices as well as a decrease in portions. Neither method will work for Mulan's, Ni said. The restaurant is only a few months old and she's reluctant to raise prices so soon. She can't control customers' portions because the restaurant is buffet style. "A lot of people come to a buffet and they eat and waste more," Ni said. |
