Despite bumper crops in Vietnam and India, export limits and bans have created a global shortage and driven up prices
At the Costco in San Francisco, rice is all the rage. Not long after the 10 a.m. opening on Apr. 24, the warehouse club was well on its way to selling out the day's supply of Thai jasmine rice. Within an hour, customers cleared three pallets loaded with 50-lb. bags of Super Lucky Elephant brand jasmine rice from Thailand. Real estate broker Mary Jane Galviso snapped up two bags—the limit imposed by this particular store. "This is very frightening," says Galviso, who hails from Orosi, a rural community in California's Central Valley, more than 200 miles southeast of San Francisco. Her local grocery, which specializes in Filipino foods, has run out of Thai jasmine.
In a dramatic development for U.S. consumers this month, shoppers and Asian and Indian restaurant owners started panic-buying two of the highest-premium varieties of rice—Thai jasmine and Indian basmati. That led many grocers to run out of the rice, and warehouse clubs including Costco and Sam's Club imposed limits on how much rice shoppers can buy.
The restrictions placed by Issaquah (Wash.)-based Costco (COST) vary across the country, while Sam's Club, a division of Wal-Mart Stores (WMT), limited its customers to four 20-lb. bags of rice. "We've heard of cases where restaurant owners are hoarding three weeks' supply of rice in their basement, which is obviously more than they currently need, which makes the situation even worse," says Richard Galanti, Costco's chief financial officer.
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