Over the past few months, the rising cost of rice around the world has caused hoarding and riots to break out throughout Asia.
Come on, I can understand Montreal Canadiens’s fans rioting in the streets after an unimpressive first-round NHL playoff win, but starving people wanting rice? Now, you’re just pulling my leg.
It’s true though, and in an ironic response to the very excesses they profit from, Sam’s Club and Costco were the first to sound the alarm here on the home front. These discount warehouse stores are now limiting sales to 4 bags of rice per person per visit. Both stores have also seen increased demand for flour and oil, but as yet, have not imposed limits on those items.
In another ironic twist, this all comes the day after Earth Day. Many analysts claim that the newfound interest in ‘going green’ and being ‘eco-friendly’ has inadvertently caused the rice shortages. As global food trends change to accommodate the demand for more food being used as alternative fuels, less people will have the food to eat. Also, the major drought in Australia has added to rice shortage problems.
Similar to a stock sell-off or a bank-run, when people get worried something will run out, they go out and buy more than they need of it, causing even greater supply problem. According to an article from The Times Online things are particularly troubling in the Philippines:
Any farmer in the Philippines caught hoarding rice risks spending the rest of his life in jail for the crime of Ã¢â‚¬Å“economic sabotageÃ¢â‚¬Â.
Scary stuff. But I don’t think most Americans realize how important rice is in these countries. There are 3 billion people in the world who rely on solely rice as a staple food. In both Thailand and the Philippines there has been a 40% increase in the price of rice since January. That’s kind of like increasing the cost of sunshine in Florida by 40%. Or the price of a subway fare in New York City by 40%. Or even worse, increasing the price of the pleasure derived from quiet conversation and rustic landscapes in Montana.
But seriously, has anyone noticed any grain hoarding or increased lines at Costco recently?
The Times Online: Fears of rice riots as demand as surge in demand hits nations across the Far East, April 8, 2008
Reuters: Sam’s Club limiting sales of rice, April 23, 2008